May 9, 2001|
Coal Bed Methane on the blocks
The Government has kicked off the road shows for coal bed methane (CBM) in New Delhi. It plans to follow this up with two road shows in U.S with one expected to be in Houston, Texas.
The Government has put on offer 7 blocks under the current round of bidding. These blocks include two in Jharkhand (Bokaro & Karanpura coal fields), three in Madhya Pradesh (East & West Sohagpur and Satpura coal fields), one in Rajasthan (Barmer coal fields) and one in West Bengal (Raniganj coal fields).
* billion cubic meters
Coal Bed Methane is primarily methane gas (80% - 95%) present in coal or lignite bed seams. The reserves are expected to have a production life of 25 years with a recoverable rate ranging between 25% - 30%. The last date for bidding is August 31 '01 and the Government plans to award the blocks by the end of 2001. The bids will be evaluated on parameters and weightages similar to the New Exploration Licensing Policy (NELP -II). The bids will be evaluated on basis of technical capability (20%), financial capability (10%), work programme (50%) and fiscal package (20%).
To attract a favourable response the Government has permitted 100% foreign investments in exploration of the blocks. It has also offered other fiscal benefits of 7-year tax holiday and accelerated depreciation. Producers will also sell the gas at market-determined prices.
The Government has launched NELP -II and CBM in the current fiscal. The main aim of putting the crude oil and gas blocks on sale is to reduce India's dependence on external sources of energy.
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