Financial Daily from THE HINDU group of publications
Friday, Feb 10, 2006
Financial Daily from THE HINDU group of publications Friday, Feb 10, 2006 |
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Policy Industry & Economy - Petroleum Bottlenecks cleared in Ratna-R production contract Pratim Ranjan Bose
Kolkata. Feb. 9 , THE production-sharing contract (PSC) involving the Ratna-R series oilfields finally seems to be ready, paving the way for the development of the field, which has been on hold for over a decade. The oilfield is held by a consortium of Essar (50 per cent), ONGC (40 per cent) and Premium Oil of the UK (10 per cent). Essar holds the operating interest in the field, which has an estimated reserve of 500 million barrels. The Union Law Ministry had recently shot down arguments which were delaying the contract and had advised the Ministry of Petroleum and Natural Gas to finalise the PSC as per the terms and conditions agreed way back in 1996. As a result, the Petroleum Ministry had recently asked Essar to clarify its position on certain doubts raised by ONGC on issues related to evacuation and delivery of oil. According to sources, Essar officials told the ONGC this week that, as per the agreed terms and conditions between the three stakeholders, the evacuation should take place either through the Hira-Uran pipeline or tankers. ONGC had placed a counter-offer of paying the current rate of cess (Rs 1,800 per tonne) and royalty (10 per cent of the well head oil price) in exchange for an operating interest in the block. ONGC's offer was higher than the 1996 agreed cess of Rs 900 per tonne and royalty of Rs 528 per tonne. Essar and Premium Oil, however, pointed out that all the other 11 fields auctioned along with Ratna-R had agreed to pay cess and royalty at the same rate. It is learnt that, following Essar's submission, the long-pending production sharing contract may finally be forthcoming.
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