ONGC Must Bid for Shale Concessions

The Indian government has turned down a request by Oil and Natural Gas Company (ONGC) for preferential treatment in the allocation of concessions for shale gas, saying that it will continue an auction policy.

State-owned firms such as ONGC, will not be exempted from the process.

ONGC made the request with specific reference to Durgapur, where it announced a shale gas discovery in January. The public sector enterprise already has the right to explore coal bed methane in this region.

While saying no to ONGC, the government pointed out that it had earlier turned down a similar request from Essar Oil, which wanted the right to explore for crude oil in the Raniganj CBM block.

ONGC, which was given the blocks for crude oil exploration on nomination basis over a decade ago, wanted a similar treatment on shale block allocation.

The petroleum ministry has chosen not to grant extra rights to anyone without competitive bidding on the blocks already licensed to them for exploration of some other hydrocarbon.

ONGC spudded its first shale gas well near Durgapur in West Bengal last September and plans to drill three more wells in Damodar Basin.

Source: Financial Express