Send in comments by 30th June on BEC for NELP-VII

Vol 11, PW 4 (28 Jun 07) People & Policy

Anyone interested in bidding for blocks in NELP-VII would do well to contact the DGH in the next 48 hours.

Go to for a detailed set of Bid Evaluation Criteria proposed for the next round and send in your comments and suggestions by 30th June at the latest. As first reported in our last issue, an important change from the previous NELP rounds is that no marks will be given for the technical capability of bidders for onland and shallow water blocks.

In NELP-VI, 15 marks were earmarked for technical capability. But bidders must still be â€کtechnically capable’ to bid for the blocks, i.

e. a rank newcomer will not be permitted to bid if technically unqualified.

The DGH also wants to set aside 10 marks for Indian and foreign companies bidding together for deepwater blocks, with one of the companies bidding holding at least 10% in the consortium and proving experience of producing from beyond 1000 metres water depth. This was not the case in NELP-VI.

There are changes also in the parameters for assessing the technical capability of bidders in deepwater blocks. For the biddable work programme, the DGH will consider only the number of wells and not their depths.

A crucial change from NELP-VI is the manner in which the government share of profit petroleum is bid. NELP-VI was dogged by controversy when several successful bidders offered high profit share to the government in the initial stages only to taper it down to zero at higher production levels.

For NELP-VII, the DGH is clear that this situation must be reversed. “Companies are required to bid the lowest profit share to the government at the minimum post tax investment multiple level and highest government share at the maximum PTIM level.