CCI clears investment worth $2.7 billion in oil and gas sector

The Cabinet Committee on Investment (CCI) on Monday eased the conditions imposed by the Ministry of Defence (MoD) in 25 oil and gas blocks, out of the 31 blocks those come up for review.

Out of the 25 blocks cleared, 9 blocks have been fully cleared and 16 blocks have been cleared with specific conditions.

Out of the 31 blocks reviewed by CCI, 13 blocks belong to Reliance Industries-BP (RIL-BP), 15 blocks are of government-owned Oil and Natural Gas Corp (ONGC) while the remaining 3 blocks belong to Australian firm Santos Cairn India.

Due to clearances given in 25 blocks in the CCI meeting, investment already made to the extent of $ 2.71 billion will be put to use and further investment to the extent of $ 1.9 billion will be made in the exploration activities in the next 3-5 years.

"The clearances given by CCI will remove the uncertainty and energize oil and gas exploration activities in the country. Huge investment is expected in these blocks in the coming years based on discovery of hydrocarbons," the government said in a press statement.

These blocks were facing clearance issues from the MoD, which had asked these firms not to start any pipelines or exploration structures on sea surface.

The ministry's main contention was that these blocks either fall under the Defence Research and Development Organisation (DRDO) operational area, the Indian Air Force (IAF) danger zone area or the Naval exercise areas.

In March this year the CCI had also cleared five "no-go" areas for oil and gas exploration, which were facing similar issues from the ministry.

Out of the 31 blocks, 19 blocks are off shore of the Mahanadi and Krishna Godavari basin, 4 blocks in North-East Coast (NEC), 3 in Cauvery basin, 2 in Palar and 1 in the Andaman sea and 2 blocks are in the Gujarat Saurashtra basin.