India has reached out to UK-based investors to
attract international public-private-partnerships (PPP) in the country's oil
and gas sector with a roadshow in London. The Ministry of Petroleum and Natural Gas, along with the Directorate
General of Hydrocarbon (DGH), held an interactive session on Monday (29 October 2018) which
attracted around 125 participants.
The session was aimed at sharing the new policy
and regulatory regime in India and details of investment opportunities in the
field of oil and natural gas exploration and production (E&P).
"India is a bright spot in the world
economic order, where demand for petroleum products is on the rise. The primary
energy demand of the country will almost double in the next 12 years. This
roadshow is a call to involve international partners in this journey,"
Ahuja, CEO and Managing Director of Indian Strategic Petroleum
Reserves Limited (ISPR).
Earlier this year, Petroleum and Natural Gas
Minister Dharmendra Pradhan had launched Bid Round-II under Discovered Small Field Policy (DSF) and Open Acreage Licensing Policy (OALP) for competitive bidding.
Under OALP Bid Round II, 14 blocks will be
offered with a total area of 29,233 sq km and under DSF Bid Round II, 25
contract areas are on offer covering 59 discovered oil and gas fields, spread
over 3,000 sq km, the ministry said.
The DSF-II and OALP-II Bid Rounds are aligned to
India's Hydrocarbon Exploration and Licensing Policy (HELP), which adopts the
Revenue Sharing Model in an effort to improve ease of doing business in India's
"It comes with attractive fiscal terms like
reduced royalty rates and no cess, single license for all hydrocarbons, pricing
and marketing freedom, freedom to exploration throughout contract period, no
signature bonus and provision for sharing of common facilities," the
ministry said in a statement.
Manish Singh, Minister (Economic) at the High
Commission of India in London, inaugurated the Investment Promotional Event for
Exploration and Production Opportunities in London, which was chaired by VP
Joy, Director General, DGH.
Besides a presentation for UK investors on the
various opportunities in store, an overview of the Indian taxation regime was
provided by KPMG - as knowledge partners.
Under Phase I SPR, ISPRL said it has successfully created 5.33 MMT of crude oil inventory
storage installations in underground mined rock caverns at three locations
namely Visakhapatnam (1.33 MMT), Mangalore (1.5 MMT) and Padur (2.5 MMT).
In line with the integrated energy policy of the
Indian government, which calls for 90 days' reserves, the Union Cabinet
accorded "in principle" approval for Phase-II SPR programme, which
involves the creation of additional 6.5 MMT of storage inventory entailing
underground mined rock cavern storages and associated facilities at Chandikhol,
Odisha (4.0 MMT) and Padur-II, Karnataka (2.5. MMT).
"In order to explore feasibility of
commercialisation of the Phase I SPR at Padur (2.5 MMT) and the planned Phase
II SPRs at Chandikhol, Odisha (4.0 MMT) and Padur II, Karnataka (2.5 MMT), it
is planned to solicit investment partners and pursue the initiatives of Phase
II SPRs through PPP mode of implementation for construction, filling, and
operation respectively and also filling and operation of the existing Phase I
SPR at Padur," ISPR said in a statement.
It added: "Since India has the
second-largest refining capacity in Asia and fourth-largest in the world, these
storage inventories would offer a unique opportunity for various stakeholders
and investors including construction companies, financing institutions, trading
firms, developers, oil & gas companies etc to explore the possibility of
participating in the process.
"Given the vantage coastline of India, the
storage locations fall on the transhipment routes of crude oil from the Middle
East source countries to the Far East consuming nations."
Based on the response of investors around the
world, a suitable PPP model will be prepared for international competitive
bidding by an individual organisation or through joint venture partners.