India: 80 oil, gas blocks fall victim to UPA policy
Failure of various agencies to give clearances locks up $13.5 billion investment
Putting a question mark over the “credibility” of policy and decision-making in the Manmohan Singh government, the failure of the Defence Research and Development Organisation (DRDO), the Department of Space and the Ministries of Defence and Environment and Forests to grant clearances has held up 80 oil and gas blocks with an investment of $13.5 billion for many years.
This is despite the fact that the Prime Minister's Office and Dr. Singh's Principal Secretary Pulok Chatterjee have held a series of meetings and issued directions to the Departments concerned to sort out the issue at the earliest.
“The domestic and international investors who have already pumped in huge amounts into these blocks, awarded under the NELP scheme, are feeling cheated. The clearances in some cases have been held up for the past eight to nine years,” a senior official of the Petroleum Ministry said.
The Petroleum and Natural Gas Ministry's request for setting up an Inter-Ministerial Committee, composed of representatives from the Ministries concerned and empowered to give one-time clearance, is still pending, adding to the increasing perception of “policy paralysis” in the UPA government.
In a note to the Cabinet Secretariat, the Petroleum Ministry has said that despite several rounds of talks with the Ministry of Defence (the Navy and the Air Force), the Department of Space and the DRDO, the situation remains unresolved.
“For the blocks where initial clearances are secured, clearances were denied subsequently, either at the seismic survey stage or at the drilling stage. Clearance at this stage is to be based on specific details of manpower equipment, the type of work and the period of operations only. But clearance is not being given with general observations that those areas are required for operations by the Defence Ministry forces,” the note said.
The companies impacted by this policy “flip-flop” include the state-run Oil and Natural Gas Corporation (ONGC), Oil India Limited (OIL), GAIL India, HPCL-Mittal, ENI of Italy, FOCUS Energy, BHP Billiton, GVK, Santos, Cairn India and Geo Global Resources.
The note said 80 exploration blocks were awaiting clearance from the Navy, the DRDO, the Ministry of Environment and Forests, the Department of Space and the Air Force.
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