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DGH overhauls PSC for NELP/Pre-NELP blocks, reduces paperwork

The Directorate General of Hydrocarbons (DGH) has limited the number of statutory approvals required for oil and gas blocks under NELP and pre-NELP regime
DGH overhauls PSC for NELP/Pre-NELP blocks, reduces paperwork
DGH overhauls PSC for NELP/Pre-NELP blocks, reduces paperwork
  • The total number of processes and procedures have been cut from 37 to 18
  • The number of processes where NELP and pre-NELP blocks will have to seek statutory approvals have been halved from 12 to six

New Delhi: Announcing a major overhaul for New Exploration Licensing Policy (NELP) and pre-NELP oil and gas blocks, the Directorate General of Hydrocarbons (DGH) has limited the number of statutory approvals required for extension of contracts, sale of stake and annual accounts, and has allowed self-certification for a number of processes and online submission of documents. The overhaul has been undertaken for the “simplification and standardisation of procedures and processes under Production Sharing Contract of Pre-NELP/NELP Blocks,” said DGH in a circular released on Tuesday. It added that the processes have been rationalised and limited in order to enhance ease of doing business.

“Ease of doing business is one of the key focus areas of the government in Exploration and Production (E&P) sector with the objective to increase investment and production. Simplification and standardisation of procedures and processes make the system transparent and efficient,” said DGH in the notification. 

DGH halves processes where statutory approvals will be required

The number of processes where statutory approvals will be required have been halved from 12 to six. Statutory approvals will now be needed for extension of exploration phase, liquidation damages on account of cost of unfinished work programme, assignment/transfer of participating interest, site restoration plan/abandonment plan, extension of production sharing contract, end of year statement and annual audited accounts. 

A total of nine processes have been categorised under Category A, where documents will be accepted on self-certification basis, and no approval will be required. DGH has allowed deemed approval on expiry of 30 days of submission of self-certified documents on the annual work programme, appraisal and field development plan or its revision.

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The total number of processes and procedures have been cut from 37 to 18. “Thus the 37 erstwhile processes of contract compliance are now covered by 18 processes of contract compliance by merging or subsuming in other processes,” the DGH said.

Online submission of documents only after Aug 15: DGH

The DGH also said that no hard copies of documents will be entertained in DGH after August 15. “Against all the aforementioned processes, Contractor shall make submissions in the prescribed online mode only and no hard copy will be entertained in DGH after 15th August, 2021. DGH will separately issue Guidance Document for facilitation of Contractors in this regard,” said the circular. 

Backdrop

State-run Oil & Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) contribute around two-third of India’s total oil and gas production from fields that have been given to them on a nomination basis. The rest of the output comes from NELP and pre-NELP blocks. Together, they contribute the lion’s share of India’s total domestic crude oil and gas output. The pre-NELP regime has oil and gas blocks like Panna/Mukta and Tapti in western offshore areas and Ravva Basin in the KG Basin. The NELP regime houses Reliance Industries Ltd’s KG-D6 block in eastern offshore, which is expected to contribute a large percentage of India’s total domestic natural gas production.

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