Details of Bid Evaluation Criteria for NELP-VI

Vol 9, PW 21 (09 Feb 06) People & Policy

Disappointed bidders in the last licensing round will be happy to hear the government has radically modified the Bid Evaluation Criteria for NELP-VI acreage to encourage more companies to bid.

Most important, blocks in logistically difficult areas will pay less profit oil to the government. Not only this, the DGH has agreed to clearly identify blocks in frontier areas to avoid the sort of row it had with Geopetrol during the last round about whether block AA-ONN-2003/1 is frontier or not.

DGH officials said it isnt. Geopetrol said it is.

In this round the DGH has so far identified 55 blocks for auction, but this might rise. Blocks will be listed in two categories: A and B.

Twenty-four blocks are listed in category A and 31 blocks in category B. Category A blocks are easily accessible, category B blocks less so.

Category B blocks are in logistically difficult but potentially good areas like Mizoram or the Assam jungle and in the ultra deep waters, a senior official tells us. Of the 31 category B blocks, 24 are frontier blocks: 12 ultra deepwater and 12 onland.

Phase-I of the NELP-VI work programme will last four years and Phase-II will last three years. Significantly, frontier blocks will be permitted an extra year to carry out their Phase-I work programme: five years.

Much higher importance will be given to a companys technical competence. Bid Evaluation Criteria A category - weight on a scale of 100 points Onland and Shallow Water Deepwater Blocks Technical capability 15 20 Work programme 25 20 Fiscal package 60 60 Bid Evaluation Criteria B category - weight on a scale of 100 points Onland and Shallow Water Deepwater blocks Technical capability 15 20 Work programme 35 30 Fiscal package 50 50 Another important change is recognition that only the operators technical capability should be considered, not that of his partners.

Also scrapped is the onerous requirement to prove financial strength, a move that will greatly encourage smaller companies. The fourth criteria of financial capability of the bidder has been scrapped, we hear.

This will encourage smaller companies to bid. Still, the minimum work programme will be more demanding.

In this round the operator must undertake a mandatory work programme and a biddable work programme. Earlier we used to give large areas and operators would perform work only on small parts, adds a source.

This time we have introduced a mandatory work programme as a qualifying criteria. DGH officials tell us uniform 2D coverage of the whole block from the mandatory work programme will go into a National Data Repository required for the introduction of an Open Acreage system.