Defence, oil ministries told to sort out issues

The Cabinet Committee on Investment (CCI) on Wednesday directed the oil and defence ministries to sort out their differences within a month on the 39 oil blocks where exploration projects are stalled.

"Certain problems (in the oil and gas sector) were identified and the ministry of petroleum and natural gas has been tasked with the responsibility of sitting down with the ministry of defence and resolving the problems with regard to 39 blocks," Information and Broadcasting Minister Manish Tewari told reporters after the meeting.

An official statement here said the CCI directed both defence and petroleum ministries to formulate solutions within one month to the issues relating to the exploration and production in 39 NELP (New Exploration and Licensing Policy) oil and gas blocks.

The petroleum ministry sought a directive from CCI for waiver of the stringent conditions attached to defence ministry clearances for 32 blocks. The defence ministry classified the areas of another 14 blocks as no-go for exploration activities.

The petroleum ministry earlier got clearance for 27 out of a total of 78 blocks. State explorers like ONGC and private-sector companies including Reliance Industries and Essar had committed to exploration programmes after obtaining various government clearances.
The oil ministry said that non-clearance of the blocks could lead to contractual disputes and even exodus of foreign investment.

The government earlier this month set up the CCI for fast-tracking clearances for projects worth more than Rs.10 billion.

Apart from Prime Minister Manmohan Singh, the CCI has 15 cabinet ministers.