Monday, July 6, 2020
Home India Government adopts revenue sharing model for auctioning 69 small oil and gas...

Government adopts revenue sharing model for auctioning 69 small oil and gas fields

By NewsGram Staff-Writer

New Delhi: The Modi government has decided to replace the existing production sharing model with revenue sharing model while auctioning 69 small oil and gas fields.

NDTV
NDTV

This decision by the government is likely to benefit explorers and will help in harnessing the hydrocarbons worth Rs 75,000 crores, according to a report in the Times of India.

Since 1999, around nine rounds of auctions have been conducted in which 254 blocks have been auctioned under the production-sharing regime. In this model, the companies share their profit with the government in a graded manner. Also, the government sets the price and decides the buyers to whom the companies must sell.

In the new revenue sharing model, the bidder who offers the highest revenue to the government and shows maximum commitment to work wins the bid. The government is likely to give 80% weightage to the revenue shared and 20% weightage to work commitment. Further, no restrictions will be placed on pricing or marketing.

The new model is more beneficial than the old model as it is simple and more transparent, it minimizes the need for government monitoring, and importantly it protects government’s interest in both high and low oil-price scenarios. It also removes the disputes that arise during cost-recovery.

But, it has few limitations as well. It will not provide cover for risk capital exploration and may become useful for only the smaller blocks and not mainstream blocks due to India’s low prospectivity, according to TOI report.

STAY CONNECTED

18,994FansLike
362FollowersFollow
1,778FollowersFollow

Most Popular

Children Raised with Pet Dogs to Have Better Social-Emotional Skills

Young children from dog-owning households have better social and emotional wellbeing compared to those who do not own a dog, say researchers. For the findings,...

Swiggy Integrates Premium Home Delivery Platform “Scootsy”

Foodtech unicorn Swiggy on Monday said it has integrated its premium on-demand delivery platform Scootsy as well as its restaurant partners within the Swiggy...

National Safety of India Endangered by Islamist Missionary Movement

By Purnima Nath National Security and safety is Compromised - India has been hit with a lethal weapon, Chinese coronavirus, primarily linked to orthodox Islamist...

Infant Sleep issues Linked To Mental Health Problems in Adults

Researchers have found that sleeping problems in early childhood may be linked to the development of certain mental health disorders in adolescence. The study, published...

10,000 Bed Sardar Patel Covid-19 Centre To set up at Delhi

The 10,000-bed Sardar Patel Covid-19 Care Centre and Hospital, inaugurated here on Sunday by Delhi Lieutenant-Governor Anil Baijal, which will serve as a major...

UP Government to Set World Record in Tree Plantation Drive

The Yogi Adityanath government is all set to set a new world record by planting 25 crore trees on Sunday in a massive plantation...

Queer Representation in Bollywood

Soon, Akshay Kumar will be seen essaying the role of a transgender in "Laxmmi Bomb". Sonam Kapoor has explored the complexities of being a...

WHO Stops Hydroxychloroquine, HIV drugs in Covid-19 trials

The World Health Organization (WHO) said on Saturday that it was discontinuing its trials of the malaria drug hydroxychloroquine and combination HIV drug lopinavir/ritonavir...

Recent Comments