India to put 46 blocks on auction

The National Democratic Alliance Government of India is preparing to auction 46 oil and gas blocks in 13 prospective sedimentary basins across the country, according to Indian- and English-language business newspaper The Financial Express, in an effort to draw investments in domestic exploration and production.

India aims to bring down its crude oil imports, which jumped to 1.39 billion barrels of oil in 2015, compared to 1.26 billion barrels of oil in 2012.

The low oil price environment has also led Italian company Eni, Australian independent Santos and super-major BP to abandon 57,000 square kilometres of oil and gas blocks in India as part of asset restructuring, impacting domestic output negatively.

The 46 blocks up for auction include 17 onshore, 15 shallow water and 14 deepwater assets. India’s Ministry of Petroleum and Natural Gas will offer reformed revenue-sharing contracts for these blocks, according to The Financial Express, a significant change from the cost recovery model contracts handed prior to the mid-2015 policy change.

The Indian economy is expected grow 8 percent in 2015. Propelled by low oil prices, the country may become the world’s third-largest oil consumer by 2016, overtaking Japan.

The International Energy Agency estimated India’s domestic consumption in the second quarter of 2015 at 4.1 million barrels of oil per day (bopd), compared with Japanese consumption in the quarter of 3.8 million bopd.

The country imports 65 percent of its oil, the demand for which has risen by 300,000 bopd when compared to 2014.

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