Oil India Ltd (OIL) expects the Environment Ministry's approval for its East Coast on-land block soon. The public sector exploration company had sought the Ministry's approval to undertake hydrocarbons exploratory activity for KG-ONN-2004/1.

A senior OIL official said, “These are normal regulatory requirements that are required to undertake exploratory activity in the forest areas. We have started seismic work in that part of the block which does not fall under the forest area.”

OIL was awarded this block under the sixth round of NELP. OIL owns 90 per cent stake in the block, while Canadian company GeoGlobal Resources holds remaining 10 per cent. To undertake first phase of exploratory activity, OIL plans to spend close to Rs 1,000 crore in the block.

Last month, the Forest Advisory Committee (FAC) of the Environment Ministry has asked the Andhra Pradesh Government to submit a report on whether undertaking any exploratory activity in the area located near the boundary of the Coringa Wildlife Sanctuary will have an impact on the wildlife in general and avifauna in particular.

The FAC is now to take a final call on the project. Subsequent to the mandatory approvals OIL will take up its seismic studies in the remaining part of the block, the official said.

This will be followed by drilling of exploration wells. The block covers approximately 566 sq km onshore in the KG basin, of which 55 sq km is in the forest area.

The production sharing contract (PSC) for the KG block provides for work commitments to be met in two phases over an exploration period of seven years, with four years under phase-I and three years in phase-II. Shares of OIL ended marginally higher at BSE on Tuesday at Rs 1,236.35.

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