Financial Express: India’s Quest for Oil and Gas: More Questions Than Answers

The petroleum ministry has gone into overdrive with two recent policy announcements. It decided to offer 69 small oilfields for development through an international bidding process and has floated a consultation paper on the future contours of oil and gas exploration policy. The controversies with Reliance over the KG-D6 field development led the UPA government to constitute the Rangarajan Committee to suggest an appropriate contractual framework for petroleum exploration and production in the country. Probably, at least in part as a response to dissatisfaction of oil companies with this report, another committee under Vijay Kelkar—which included members with experience in the upstream petroleum industry—was constituted over two years ago to suggest measures to meet India’s hydrocarbon requirements over the next two decades.

The recommendations of this committee, which landed on the table of the current government over a year ago, appear to have been partially acted upon. However, what defies logic is the current move to again launch a consultation process with stakeholders on hydrocarbon exploration policy. Oil companies, national and private, have forcefully put forth their views over the past three years; there is little or nothing left for them to say further. But an examination of the major issues raised in the consultation paper show that the same path as in the past is being traversed by the government, with the same old wine being served in the same old bottles. It may, hence, be instructive to see what the consultation paper highlights and what it implies for government action in the coming months. MORE