Briefing newspersons here on the outcome of the CCEA decisions, Home Minister P Chidambaram said the main objective of the approval is to enable carrying out an Additional Exploration Work Programme in Nagaland portion of the Block by signing of a separate PSC for the state's portion, on terms and conditions not inferior to the existing ones in the present PSC.
The following are the details of the new dispensation: (i) A separate PSC for Nagaland portion of the Block, effective from August 9, 2006, is to be signed. The Exploration Period of the PSC will be valid for a period of seven years from the effective date; (ii) A cumulative exploration work programme of 2D seismic survey for 150 Line Kilo Metres (LKM), re-processing available data of 100 LKM and drilling of two exploratory wells during three exploration phases of two, three and two years duration will be carried out by the contractor, which is over and above the MWP already accomplished by the contractor in the existing PSC.
There is no financial expenditure involved on behalf of the Government. The contractors under the signed PSCs have commitments to carry out exploration work programme which may lead to discoveries of hydrocarbons.
Mr Chidambaram said the Special dispensation will facilitate exploration in the frontier area of Nagaland and the objective of accelerated exploration of hydrocarbons in the country would be accomplished in this Frontier Area.
He said the proposal would be implemented immediately and a new PSC will be signed between the Union Government and the contractor.
Canoro Resources Limited (CRL) is the operator in Pre-NELP on-land Block AA-ON/7. The Production Sharing Contract (PSC) for the Block was signed on February 19, 1999. The original Block area was 1934 sq km of which 1126 sq km was in Assam and 808 sq km was in Nagaland.
Petroleum Exploration License (PEL) for Assam portion of the Block was granted on March 27, 2001, and PEL for Nagaland portion was granted on August 9, 2006. Exploration Phase-III has expired on March 26, 2008. The MWP for all the three phases was completed in the Assam portion of the Block only.
No exploration work could be carried out from March 27, 2001 to August 9, 2006 in Nagaland portion of the Block.
Nagaland is a logistically tough area and signing of this separate PSC for Nagaland portion of the Block would facilitate restoring E&P activities in the state. Special dispensation has been considered to explore this Frontier Area by entering into a separate PSC, with terms and conditions not inferior to the existing terms and conditions in the present PSC.
The contractor proposes to undertake exploration work in Nagaland part of the Block, as PEL for Nagaland was granted on August 9, 2006.