In July 2017, India opened 2.8 million sq km of sedimentary basins for oil and gas exploration in a bid to raise domestic production and cut excessive dependence on imports. 51 proposals seeking about 60,000 square kilometre of area for exploration of oil and gas have been bid for in India’s maiden auction under open acreage licensing regime. The Open Acreage Licensing (OAL) allows companies to select blocks or areas after studying seismic data to explore and produce oil and gas.
OAL replaces the old system of government carving out areas and bidding them out. OAL allows investors to carve out their own areas and put in an expression of interest (EoI). Once an EoI is received for an area, it is put on competitive bidding and any company offering the government maximum share of oil and gas is awarded the block.
Last date for submission of EoI in the first cycle of bidding under OAL is 15 November, 2017 and winners would be announced by 1 January, 2018. OAL is being offered under the Hydrocarbon Exploration and Licensing Policy (HELP) that provides revenue sharing model for bidding for oil and gas blocks. It promises marketing and pricing freedom for oil and gas produced.