New Delhi, Dec 30 (UNI) Despite the spectre of a fuel price hike looming large, the hydrocarbon sector in the country went through one of its most momentous phases across its entire value chain.
The government dominated sector saw an acceleration of domestic production of oil and gas, putting in place an investor-friendly policy regime for the rapid growth of investment and oil sector infrastructure, promoting biggest FDI in refinery sector, protecting consumers of sensitive petroleum products against global price rise, encouraging technological capacity building by setting up an institute of national importance, etc.
Describing the year as momentous, Petroleum and Natural Gas Minister Murli Deora said, ''2007 has been a significant year in terms of accelerating exploration efforts in India, new oil and gasfinds, acquiring E&P assets abroad, building oil sector infrastructure and ensuring sale of quality products, etc.'' Exploration and production sector in the year has been remarkable for as many as 52 blocks were awarded under Sixth Round of New Exploration Licensing Policy (NELP-VI) in March 2007, the highest ever.
This was capped with a record number of 57 exploration blocks being offered for bidding under Seventh Round of New Exploration Licensing Policy (NELP-VII), giving a big boost to the domestic exploration&production(E&P). Oil PSUs and private and Joint Venture companies made more than 40 new hydrocarbon discoveries/new prospects/new pools during the year(ONGC-21, OIL-4 and Pvt/JV companies-16).
To enhance energy security of the country, a major thrust was given to acquiring E&P assets abroad besides oil discovery in one block. Oil PSUs acquired participating interests in various countries- ONGC-Mittal JV Company (2 blocks in Nigeria and one in Turkmenistan-30 per cent share), OVL (2 blocks in Brazil and 3 blocks in Myanmar), OIL-IOC Consortium ( 4 blocks in Libya) and BPCL( one block in Australia).
In addition, Gail India Ltd(GAIL) and Hindustan Petroleum Corporation Ltd (HPCL) and Indian private companies such as RIL, Essar are actively engaged in overseas E&P business.
As part of this initiative, ONGC Videsh Limited (OVL) and its partner IPR Red Sea made a significant new oil discovery in their first exploration well North Ramadan-1A in the North Ramadan Concession in Egypt.
India joined a select group of countries like US, Australia to commence commercial production and sale of Coal Bed Methane(CBM) gas as of July 14, 2007 from the block Raniganj South in West Bengal operated by Great Eastern Energy Corporation Ltd.
In another major development Government recorded approval for the formula and mechanism for the price of gas discovered under NELP.
The Empowered Group of Ministers (EGoM) decided that price discovered on arms-length basis through bidding will be adopted under NELP and upheld the sanctity of legally binding contracts.
This provides a boost to investor confidence and would facilitate expediting production of natural gas from India's biggest gas discovery in Krishna-Godavari (KG) basin next year leading to domestic production doubling from about 95 million standard cubic metres per day(MMSCMD) now.