India aims to boost domestic output to reduce the dependence on oil imports. Credit: minnemom.

The Indian Government is launching an auction of oil and gas blocks under the second exploration licensing round in an attempt to enhance domestic production to reduce the reliance on imports.

Under the Open Acreage Licensing Policy (OALP) bid round-II, companies can bid for 14 blocks covering an aggregate area of 29,333km². Around 47% of the acreage on offer is located onshore, while shallow water and ultra-deepwater respectively account for 48% and 5%.

Five of the blocks are located in the Mahanadi basin, namely one each in Cauvery; Rajasthan; and Krishna Godavari, and two each in Cambay, Andaman, Kutch basins.

In 2017, the government permitted companies to carve out their own blocks in an effort to bring 2.8 million square kilometres of unexplored area under exploration. The new policy replaced the earlier system under which the government carved out areas and auctioned them.

“India awarded 55 blocks measuring a total area of 59,000km² last year in OALP-1, with Vedanta securing 41 of them.”

Companies can submit an expression of interest (EoI) for prospecting of oil and gas in any area that is currently not under any production or exploration licence.

While the EoIs can be submitted throughout the year, the bidding rounds are conducted in six-month cycles.

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The blocks were initially expected to be auctioned by last June, according to the Press Trust of India (PTI).

Citing unidentified officials, the news agency reported that the 14 blocks being auctioned are estimated to hold in-place resource of 12,609 million tonnes of oil and oil equivalent gas.

India awarded 55 blocks measuring a total area of 59,000km² last year in OALP-1, with Vedanta securing 41 of them.

The remaining blocks were won by Oil India (nine), Oil and Natural Gas (2), gas utility GAIL (1), upstream division of Bharat Petroleum (BPCL) (1) and Hindustan Oil Exploration (HOEC) (1).

The government aims to reduce the oil import bill by 10% to 67% by 2022, and to 50% by 2030.