Some analysts attribute the abandoning of 15 oil and gas blocks by BP and Reliance Industries (RIL) to unfriendly investor policy of the government. But BP termed the relinquishment of blocks as a routine “portfolio management” exercise.
These 15 blocks are part of the 21 blocks for which BP struck a $7.2-billion deal. According to industry observers, the development does not augur well for the domestic oil and gas industry.
This is not the first time an oil company abandoned asset in India. Three years ago, Norwegian oil major Statoil and Brazil’s Petrobras pulled out from ONGC’s prolific Krishna-Godavari basin block because of bureaucratic hassles and delays in getting regulatory approvals.
Therefore, analysts suggest the government to pursue investor friendly policies in the sector in order to attract private investment.
The fact that the oil ministry has not auctioned exploration blocks for over two and a half years shows that either the oil ministry knows that hardly any company would be interested, or it is in no hurry to speed up oil exploration in the country that imports about 80 percent of the oil it processes.
India initially succeeded in luring some foreign energy firms such as Petrobras, Statoil, Santos, BHP Billiton and Eni.
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