Oil India in talks with ExxonMobil, Total, Petrobras for joint bids in new auction round

Mint

7 days ago

New Delhi: State-owned Oil India Ltd is in talks with global exploration and production (E&P) majors, including ExxonMobil, TotalEnergies and Petrobras, to jointly explore hydrocarbon blocks in India, said two people in the know of the developments.
Oil India's one-on-one talks with these companies are largely focused on a possible partnership for the 10th round of auctions under the country's Open Average Licensing Policy (OALP-X). In this round, the government plans to offer 2.5 lakh sq. km. area for exploration.
The OALP-X round was launched in February and the deadline for submission of bids is 31 July. According to one of the people cited above, there is likelihood of an extension of the deadline.
'Talks are underway with major global players, Total, ExxonMobil and Petrobras. It is being looked at if Oil India can get a partner for the upcoming 10th round of auctions for deep and ultradeep water blocks," said the person mentioned above. 'The partner would also have the option to come together for blocks bagged in the previous round (ninth)."
Queries sent to Oil India, TotalEnergies, Exxonmobil, and Petrobras remained unanswered till press time.
Apart from this, Oil India is also scouting for a technical service partner in its old and legacy oilfields, where it is looking to increase production.
In an interview to Mint in May, Ranjit Rath, chairman and managing director of Oil India, had said several overseas national as well as private oil companies have shown interest in jointly bidding for blocks in the upcoming auction round.
'We have several engagements currently going on," Rath had said. 'With some of them, we have got NDAs (non-disclosure agreements) signed, and we are having data exchanges," the chairman said.
In February, the Maharatna company had signed a memorandum of understanding with Petrobras, Brazil's state-owned oil firm, to collaborate in the exploration and production of hydrocarbon resources in India's offshore regions.
Global collaborations are critical to bring in expertise for deep and ultra deepwater blocks. 'For shallow water and onshore exploration and development, most of the companies have the required technologies. But in the case of deep and ultra deepwater blocks, there are challenges in every stage, exploration, development and production, due to the ocean weight, the pressure that the ocean creates," said Gaurav Moda, partner and energy sector leader at EY-Parthenon India. 'Only a few global players have the expertise to explore and produce oil from such blocks. They also require different kind of equipment compared to shallow water and onshore exploration and extraction."
Noting the urgency in India's aim to harness its domestic reserves, Moda said that rather than trying to indigenously develop such technologies, striking a partnership with a global player would be more beneficial.
Under the OALP-IX round, Oil India bagged nine blocks, adding 51,000 sq. km. to its exploration portfolio. Three of the blocks--one each in Cambay, Mahanadi and Assam Shelf basins--were won in partnership with its public sector peer Oil and Natural Gas Corp Ltd (ONGC), while another six were acquired on its own.
ONGC, together with UK-headquartered BP plc and Reliance Industries Ltd, won the bid to explore Saurashtra basin under OALP-IX, marking BP's foray into India's upstream oil and gas space.
Oil India's move to scout for global partnerships is in line with the government's push to attract overseas investments in the upstream space in a bid to raise local production and reduce the country's dependence on imports.
During his visit to Vienna for the 9th OPEC International Seminar earlier this month, union minister for petroleum and natural gas Hardeep Singh Puri met chiefs of global energy giants and discussed potential collaborations in light of India's ambitious E&P plans.
The minister had said India is set to explore nearly 2.5 lakh sq. km. in new offshore and onshore areas under OALP-X, which will make it one of the world's largest bidding rounds.
In FY25, Oil India produced 3.46 million tonne (MT) of crude and natural gas, amounting to 3.25 MT of oil equivalent. This took its total hydrocarbon production to 6.71 MT of oil equivalent, the highest ever for the company. It aims to achieve oil and gas production of 10-12 MT of oil equivalent by the end of the decade.
In 2020, under the third round of auctions, Oil India had won two blocks in the Andaman basin, touted as an oil-rich region.