India Could Allow Joint Bids for CBM Licence, Coal Blocks

India is expected to allow bids for CBM exploration along with first round of coal block auctions.

The upcoming first round of coal block auctions could see companies being asked to bid simultaneously for coal bed methane (CBM) exploration, Hindu Business Line newspaper reported.

According to government officials, the Petroleum & Natural Gas Ministry is preparing a draft note seeking approval from the Cabinet Committee on Economic Affairs. Approval has also been sought for Ministry of Coal to invite bids for exploration and auction of CBM from the blocks it puts up for auction and make it mandatory for companies to bid for both resources together, the newspaper said.

It has also been proposed by the Ministry for Petroleum and Natural Gas that the contractor should be allowed to sell CBM gas at $5.05 per mmBtu, as per the New Domestic Gas Pricing Guidelines 2014.

According to Business Line, the contractor will be liable to pay the royalty and Production Level Payment which would help in higher revenues for the Central and State Government.