India makes significant changes in NELP

NEW DELHI, Oct. 31 (UPI) -- India has made changes in the seventh round of the new exploration licensing policy to auction oil and gas blocks.

According to a Petroleum and Natural Gas Ministry official, the empowered committee of secretaries approved significant changes in the bid-evaluation criteria and the production-sharing contracts to be signed for the blocks being offer under NELP-VII.

He said Petroleum Secretary M.S. Srinivasan approved the recommendation of the empowered group on gas pricing, which says the price discovery process on arms-length basis will be adopted in future NELP contracts only after the government approves the price formula.

“The formula on which the prices shall be decided, shall be approved by the government prior to invitation of price bids by the contractors for sale of natural gas to consumers within two months of receiving the proposal,” the official said.

He said the significant change the panel made was linked to the export of oil and gas produced from the blocks offered under NELP-VII.

“For the first time, the production-sharing contracts of these blocks will incorporate a clause under which the companies will have the right to lift and export their share of oil and gas if India achieves self-sufficiency in hydrocarbons,” the ministry said.