Cairn India is likely to get a 10-year extension for its license to explore and produce oil and gas from the prolific Rajasthan block. However, the company may have to pay more profit petroleum to the government to get a term beyond 2020.
A Committee headed by the Directorate General of Hydrocarbons (DGH) on policy for grant of extension to the Production Sharing Contracts (PSC) for small, medium-sized and discovered fields that were awarded to private firms in 1990s, has recommended a uniform 10-year extension but on revised terms and conditions. The current PSCs provide for a 5-year extension in case of an oil field and 10 years in case of gas discoveries.
The panel has recommended that contracts may be extended for 10 years for both oil and gas fields or the balance economic life of the field, whichever is earlier, but with revised terms and conditions. The Committee has also recommended a minimum 50% government share of profit petroleum from small fields and 60% in case of medium-sized fields. At present, the government's profit petroleum ranges from 25 to 60%. In case of Cairn's Rajasthan block, it is 50%.
| Company Name | CMP |
|---|---|
| ONGC | 283.95 |
| Oil India | 470.10 |
| Jindal Drilling&Inds | 540.15 |
| Deep Industries | 476.90 |
| Asian Energy Service | 306.05 |
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