NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News  » Business » Govt to relaunch NELP VIII on Aug 8

Govt to relaunch NELP VIII on Aug 8

July 22, 2009 15:21 IST

The government will relaunch the country's largest-ever auction of oil and gas blocks on August 8 and will extend the last date of bidding by two months to mid-October.

The first of the promotional roadshows for 70 blocks offered under the eighth edition of New Exploration Licensing Policy and 10 coal-bed methane areas will be held in Mumbai on August 8, a petroleum ministry official said.

On April 9, India launched the eighth round of auction to give away blocks for exploration under NELP with August 10 being the last date for bidding. But it was deferred over ambiguity on tax holiday for natural gas.

"The last date of bidding will be extended, possibly to October 10, but that has not been finalised yet," he said.

Roadshows will be held in Perth on August 10-11 and Brisbane on August 13-14. An investor meeting is planned in Singapore on August 17.

Dates of roadshows in London, Houston and Calgary (Canada) have not been finalised. The Houston roadshow may happen on August 24-25 and that in Calgary on August 27-28.

The London roadshow is being scheduled for September 9-10.

The round is being relaunched after finance minister Pranab Mukherjee in his Budget for 2009-10 stated that I-T holiday for seven years on profits from producing and selling natural gas would be available for blocks to be awarded in NELP VIII.

"We have been waiting for the current Budget session of Parliament to get over to begin the roadshows," the official said.

The Budget session of Parliament ends on August 7.

The government had launched NELP VIII and CBM-IV on April 9 and bids were to close on August 10.

Although the finance minister had restored tax breaks for natural gas to be produced from NELP blocks, no such fiscal incentive has been announced for CBM blocks.

Fearing lack of investor interest on ambiguity over tax holiday for natural gas, the government had on April 17 deferred the promotional roadshows.

The finance ministry had in the 2008-09 Budget scrapped the seven-year tax holiday or exemption from paying income-tax on natural gas production. Though oil and gas naturally occurred together and a single well could be producing both, the incentive was restricted only for crude oil production.

The move drew flak from oil majors who kept away from the previous NELP VII round, which closed after the announcement.

India is offering 24 deep-sea blocks, 28 shallow water blocks and 18 onland blocks for bidding in NELP VIII, hoping to attract $3 billion investment in exploration.

India, which imports 75 per cent of its crude oil requirement, offered for bidding 10 areas for extracting gas from below coal fields or CBM.

© Copyright 2016 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.