New Exploration Licensing Policy (NELP)

 
After the Nomination era till late 1970s, Pre-NELP Exploration era (1980-95) and Pre-NELP Field rounds (1992-93), Government of India formulated a policy called as New Exploration Licensing Policy in 1997. The main objective was to attract significant risk capital from Indian and Foreign companies, state of art technologies, new geological concepts and best management practices to explore Oil and Gas resources in the country to meet rising demands of Oil and Gas. This NELP policy was approved in 1997 and it became effective in February, 1999. Under NELP, blocks were awarded o Indian, private and foreign companies through International Competitive Bidding process where NOCs, viz. ONGC and OIL, were competing on equal footing. NELP not only accelerated the quest for hydrocarbon exploration, but also brought state-of-the-art technology and efficiency of operations/ management to the country. Government of India has signed 254 contracts under NELP regime with National Oil Companies and private (Both Indian and foreign)/ Joint Venture companies. As a result of exploratory activities, several unexplored and poorly explored areas, in particular offshore and deep-water areas were appraised through geophysical surveys and exploratory drilling. NELP bidding rounds attracted many Private and Foreign Companies in addition to PSUs.
 

Hydrocarbon Exploration & Licensing Policy (HELP)

Hydrocarbon Exploration Licensing Policy (HELP) for award of acreages in the upstream sector in India was approved by the Cabinet in its meeting held on March 10, 2016. The Government notified the policy vide Notification No O-32011/4/2013-ONG-I dated March 30, 2016. The licensing programme under HELP adopted the Revenue Sharing Model, is a step towards improving the ‘Ease of Doing Business’ in the Indian Exploration and Production (E&P) sector. It comes with attractive and liberal terms like reduced royalty rates and no oil cess, marketing and pricing freedom, submission of Expression of Interests (EoIs) round the year, a single license to cover conventional and unconventional hydrocarbon resources, exploration allowed during the entire contract period, easy bidding process, transparent award and swift processing of approvals.

In continuation to its determination for reduction in import dependency of oil and gas and accelerating E&P activities, Government notified the further policy reforms vide Notification No. O-12015(11)/1/2019-ONG-II, in upstream sector on 28th February, 2019 to increase exploration activities, attract domestic and foreign investment in unexplored/unallocated areas of sedimentary basins and promote ease of doing business by streamlining and expediting the approval processes. Salient features of Policy Reforms cover Category Specific Bid evaluation criteria with more weightage to exploratory work programme, Category-II and III type blocks will be bided based on exploratory work programme only, shorter exploration period, concessional royalty rates to expedite oil and gas production, bid rounds commencing thrice in a year, and introduction of alternate dispute resolution mechanism.

Till date four OALP Bid Rounds have been conducted, with total of 94 blocks being awarded covering an area of 1,36,790 Sq. Km with leading E&P companies. The operators of these blocks have since then initiated petroleum exploration activities or are in process of obtaining Petroleum Exploration Licenses (PELs).

With the successful roll out of the HELP/OALP regime, based on the world-class National Data Repository (NDR), the Government has achieved massive enhancement of exploration acreage in India. The exploration acreage which stood at approximately 80,000 sq. km. in 2019 from earlier regimes has now been enhanced to approx. 2,20,000 sq. km. with, after 4 rounds of OALP.

Salient Features of the Hydrocarbon Exploration & Licensing Policy (HELP):

• Single License for all Hydrocarbons
• Revenue Sharing Model
• Pricing & Marketing Freedom
• Low Royalty Rates (Varies from 2% in Ultra-Deep Offshore to 12.5% Onland)
• Further concession in Royalty Rates for Early Production.
• Exploration rights on all retained area for full contract life
• Flexibility for multiple FDP revisions
• Simplified Dispute Resolution Mechanism
• Management Committee Role Revised to Reduced Number of Approvals.

Investor companies can submit EoI throughout the year in 3 windows

Total number of Blocks and Areas awarded: As On Jan 2020