The 69 small and marginal fields holding 89 million tonne of oil and gas resources, worth Rs 70,000 crore at current rates, will be given to explorers offering the maximum revenue from hydrocarbon produced to the government.
"This is a paradigm shift from the controversial production sharing contract (PSC) and cost recovery model to a more equitable revenue sharing model that protects government interest in both low oil and high oil price scenarios," Oil Minister Dharmendra Pradhan said.
Bidders will be asked to quote the revenue they will share with the government at low and high end of price and production band to capture windfall of steep rise in prices as well as quantum jump in production.
"We are committed to our Prime Minister's moto of minimum government, maximum governance. The new model will ensure that there is least government interference in the operations while also providing a fiscal and policy regime that encourages investments," he said.
The government will allow companies to sell oil as well as natural gas produced from these fields at market price and with no restriction on who they sell the produce to.
The new revenue sharing regime, which Pradhan hinted will also be followed in the next licensing round, will replace the PSC model where oil and gas blocks are awarded to those firms which show they will do maximum work. All their investments can then be recovered from sale of oil and gas before sharing profits with the government.


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