State-owned Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) spent over Rs 13,000 crore on 115 oil and gas discoveries which were taken away from them by the Government for auctioning to private companies, Oil Minister Dharmendra Pradhan said on Monday.
The present BJP-led NDA government took away so-called idle small and marginal discoveries of ONGC and OIL and auctioned them to private firms under Discovered Small Field (DSF) bid rounds.
Under DSF bid round-1, 67 discoveries, mostly of ONGC, were auctioned, while in the second round, bids for which are due next month, another 48 finds are being auctioned, he said in a written reply to a question in the Lok Sabha.
“As informed by ONGC, an amount of Rs 12,826 crore has been spent by ONGC on the discoveries/fields identified in the first and second round of Discovered Small Field Policy. An amount of Rs 224.27 crore has been spent by OIL in this regard,” he said.
ONGC and OIL are not compensated for the amount they had spent on discoveries of these oil and gas reserves. Unlike State-owned firms, the private players are allowed pricing and marketing freedom to make these discoveries viable. ONGC and OIL have stated that they could not produce from the discoveries as they are uneconomically at current cap prices.
“With a view to increasing domestic production of oil and gas, the Government in May 2016 launched Discovered Small Field Bid Round-I under which 67 discoveries of ONGC and OIL, which had not been put into production, were offered for auction through international competitive bidding,” Pradhan said. “The policy has now been extended to its second round to include 48 un-monetised discoveries of ONGC and OIL under DSF Bid Round-II.”
Under DSF-I, 47 companies participated in the bidding process, he said. ONGC and OIL were also allowed to participate in the auction to get back their own discoveries.