India’s oil, gas production processes simplified for older investors

New Delhi: In a major overhaul of oil exploration and production processes, the Directorate General of Hydrocarbons has now made it easier for companies to continue with their exploration programme without bothering about taking numerous statutory approvals at CAG stage of their work programme.

The DGH has now reduced the number of processes that earlier needed various compliance and clearances for oil and gas blocks awarded under nine bids round of the New Exploration Licensing Policy (NELP) and pre-NELP blocks.

From 37 processes that required various levels of compliance, the DGH has now restricted the number of processes needing compliance and clearances to just 18. And only in case of 6 processes including extension of exploration phase or extension of production sharing contract, abandonment of plan, transfer of participating interest in favour of a new entity, year-end statement and audited annual accounts presentation, will an existing explorer/producer of pre-NELP and NELP block need prior approval of the DGH or the government.

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The pre-NELP blocks include Panna/Mukta and Tapti oil and gas fields in the western offshore and Ravva field in the KG basin. The government undertook nine rounds of NELP that resulted in biggest oil and gas funds in the country outside nomination blocks with PSU oil explorers. The NELP blocks includes Reliance Industries’ KG D6 block and several others held by ONGC and others.

The changes done in compliance measures by the DGH is part of its initiative towards ease of doing business. The reduced clearances and acceptance of self-declaration in several processes are expected to make things easier for existing oil and gas explorers who are working towards increasing the country’s oil and gas production and reducing import dependence.

The DGH has allowed deemed approval on expiry of 30 days of submission of self-certified documents on the annual work programme, appraisal, and field development plan or its revision.

The country has shifted from NELP rounds to open acreage policy in 2016 that had made compliance lot easier for investors looking to participate in India’s oil and gas exploration and production programme. But the companies working on some existing blocks were facing lot of hurdles in continuing with their work programmes. The changes by the DGH will help in bringing the old and new regimes at par as far as compliance goes.

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