ONGC’s attempt to rope in private sector explorers as joint operators in three coal-bed methane blocks in Jharkhand and West Bengal, is facing fresh hurdle.
ONGC sources told Business Line that one of the awardees, Dart Energy (formerly Arrow), refused to take 25 per cent stake in North Karanpura and 10 per cent stake in Ranigunj block.
The Australian company, however, accepted the offer for 25 per cent interest in Bokaro.
Troubled history
According to sources, the public sector oil and gas major is now considering re-distributing the stake in North Karanpura and Ranigunj to other bidders for the respective blocks.
ONGC currently holds 90 per cent operating interest in Ranigunj and 80 per cent each in Bokaro and North Karanpura. Coal India (Ranigunj) and IndianOil (Bokaro and North Karanpura) hold the residual stake as participatory interests.
Though rated as the most prolific CBM blocks in the country with each having 1 trillion cubic feet of reserves, ONGC failed to turn them into producing assets during its decade long exploratory campaign.
As a corrective measure, the PSU major was trying to rope in private sector operators, having expertise in coal bed methane operations, for the last four years.
After a series of abortive attempts, the PSU major finally firmed up plans in April to rope in a set of two strategic partners, with 25 and 10 per cent stake each, in each of the three exploratory assets.
Apart from Dart, LSE-listed Great Eastern Energy Corporation Ltd (GEECL) is offered 25 per cent stake for the Ranigunj block (adjacent to GEECL’s existing producing asset).
Ahmedabad-based Deep Industries and a consortium led by Jindal Petroleum (a JSPL group company) are offered 10 per cent stake each, in North Karanpura and Bokaro blocks respectively.
Future uncertain
According to sources, Dart’s refusal may particularly impact the future of exploration campaign in North Karanpura. Dart was offered to play a lead role in deciding the course of exploration campaign in the block with 25 per cent stake.
While ONGC sources say that the stake offered to Dart may now be redistributed to other bidders, the modalities of the same are not clear.