Hydrocarbon Vision 2030 (ஹைட்ரோகார்பன் தொலைநோக்கு ஆவணம் 2030)

5.1.4.6 Policy environment
5.1.4.6.1 Current scenario
The North East is endowed with huge untapped natural resources and is acknowledged as the
eastern gateway of India’s Act-East Policy. The ambiguity related to the economic potential has added
fuel to the turmoil.
Despite a robust production-sharing contract (PSC) regime, Indian oil and gas block auctions have
not been able to attract big players such as Exxon, Chevron etc. The reason could be attributed to
uncertainty in policy implementation and government interference.
The North East Industrial and Investment Promotion Policy 2007 of the Government of India has laid
down a number of fiscal incentives for investors in the region. The provisions of the NEIIPP, 2007 had
requisite incentives as well as an enabling environment to speed up industrialisation of the region.
The highlights of the incentives for all industrial units, new as well as existing units and on their
substantial expansion, located anywhere in NER included excise duty exemption, subsidy on capital
investment, subsidy on plants and machinery, power subsidy and transport subsidy. The Department
of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India, issued a
circular to all the eight NER states to convey that registration under the schemes of NEIIPP, 2007 had
been suspended with effect from December 1, 2014.
Oil & gas industry was never included in NEIIPP due to budget limitations, but NEIIPP has been able
to lure small as well as large business establishments to set up their business in the state.
State governments play an important role in facilitating E&P activities, for both on-land and offshore
blocks. One of the major bottlenecks facing E&P operators is the delay in awarding requisite
approvals and clearances by the centre and state governments. This not only adversely affects
investor sentiment but also results in significant project delays and financial losses for operators. As
per current rules, the union government issues PELs/MLs in consultation with the state governments.
State governments play a vital role in supporting environment approvals, facilitating land acquisitions
etc. This indicates that support from state governments for E&P activities is critical. In the case of
offshore blocks, issues such as siting of on-shore terminals, provision of support services and
creation of pipelines for evacuation of hydrocarbons require significant state government support.
5.1.4.6.2 Latest developments
Exploration licensing policy
OALP: To make India a favourable destination globally for exploration of oil and natural gas, the
government plans to move to the OALP policy regime soon which is under formulation at
present. This will enable upstream companies to bid for any oil and gas block without waiting for
the announcement of bidding under the new exploration licensing policy (NELP) regime.
The proposed uniform licensing policy for award of hydrocarbon acreages under a new
contractual system and fiscal model will lift all restrictions on explorers hunting for
hydrocarbons. In keeping with what the explorers have been seeking for long, they can hunt for
all kinds of resources: oil, gas, coal-bed methane and shale gas. Launch of open acreage
licensing policy (OALP) regime to explore hydrocarbons depends upon the readiness of the
national data repository (NDR). The contract has been awarded to M/S Halliburton on February
28, 2014. Currently, initial data population phase of the NDR project is going on. The NDR centre
is likely to be open for public in March 2016 once initial data population is over. However, setting
up the infrastructure to feed the data in the system is bound to take some time. DGH is the
coordinating body for NDR. The NDR will be hosted at the DGH office in Noida. The government
had amended Rule 19 of the petroleum and natural gas rules to enable DGH obtain all the data
from various operators or licensees, which could be disclosed to prospective bidders as and
when required under the open acreage system.
Open acreage will enable bidders to bid for blocks on offer at any time of the year. Data for the
blocks will be made available to bidders through NDR. Pakistan also has such a system in place.
The NDR is expected to play a much larger and significant role in the exploration and production
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