JOIN USAmbanis' spat may delay bids for new oil & gas blocs
“With the government becoming a party to the legal dispute, which is lying before the Supreme Court, the Eighth round of bidding under the NELP may be further postponed till the case is finally disposed off by the apex court,” sources said.
“The legal dispute over the supply of gas from the KG basin may raise larger issues relating to national gas policy. Since these will have a bearing on exploration of oil and gas in future, the government may like to wait for the final verdict of Supreme Court and then go ahead with the bidding process under the NELP,” they added. The government, which initiated the eighth round of bidding for award of oil and gas blocks April this year, postponed the process in view of ambiguity over tax and policy issues relating to oil and gas.
The Petroleum Ministry postponed the bidding apprehending poor response from the prospective bidders in view of government not extending the seven year Income Tax holiday on profits earned by firms exploring gas while retaining the same benefit for oil explorers. However, this anomaly was removed with the finance minister in his Budget proposal for 2009-10 extending the IT holiday benefits to gas explorers.
DH News Service