Hindustan Oil complains of red tape in Gujarat

Vol 5, PW 18 (24 Oct 01) Exploration & Production

Signing a contract in India is child's play against actually starting work.

Private oil companies regularly recount horror stories about the realities of doing business in India. Take Hindustan Oil Exploration Company for instance.

HOEC was one of several companies to sign PSCs in February this year for several discovered fields in Gujarat. Eight months later it has yet to get title to the land, much less a mining lease or work permit.

The HOEC-GSPC-Heramec consortium signed PSCs for North Balol, Unawa, Allora, Dholasan, Kanawara and North Kathana. North Balol is a gasfield while the others are oilfields.

HOEC is operator at North Balol and Unawa while Heramec is operator for the four other fields. "It is very, very frustrating," reveals a source.

"The paperwork that needs to be done and layers of bureaucracy that need to be crossed are endless." A typical example of getting approval involves going to the local village or town, getting all the land ownership details, taking it to the local state government official, getting a 'No Objection Certificate' from that official and then moving the papers up the hierarchy after approval from each level. "The procedure is long and tiresome.

We are in the middle of this hierarchy, so we don't even have title to the land. We hope to get at least one title by December," HOEC tells us.

Below is a status report of HOEC's other blocks correct to 15th October 2001. Block Consortium Operator Status CB-ON-7 HOEC-GSPC HOEC 1 well testing to begin in January CB-ON-2 HOEC-GSPC GSPC Processing of 3,000 line kilometres 2D seismic CY-OSN-97/1 HOEC-Mosbacher-Energy Equity Mosbacher India Interpretation of 3,000 line kilometres 2D seismic AAP-ON-94/1 HOEC-Oil India HOEC Evaluating bids for 2D seismic model reprocessing for thrust well PY-1 HOEC-Energy-Energy Equity Energy India $90m, seven well development plan depends on gas sales agreement with PPN Power Project, Tamil Nadu.

"Negotiations on for one year, and we are starting to look at alternatives to PPN." PY-3 HOEC-ONGC-Tata Petrodyne-Hardy Oil Hardy Oil Drilling of second lateral well ongoing in $20m, four well development plan Asjol HOEC-GSPC HOEC Production ongoing CR-ON-90/1 HOEC-Tullow Oil-Essar Oil HOEC given notice of withdrawing from block in favour of Essar Oil DGH questions validity of operating/management committee meeting. Essar Oil is following-up the issue.

Production exploration licence yet to be received CB-OS-1 HOEC-Enron-Tata Petrodyne-ONGC Enron Awaiting environmental clearance since the past 19 months to begin $19m, three well work programme. Rig contracted.