CHENNAI: Vedanta Limited will enter into a Revenue Sharing Contract (RSC) with Government of India on Monday for 41 exploration blocks in sedimentary basins in the country, of which two offshore blocks are located in Cauvery basin of Tamil Nadu.
The contract signing has been organised at a private hotel in New Delhi. The event will be presided over by Dharmendra Pradhan, Minister of Petroleum and Natural Gas.Vedanta Limited has been awarded the blocks pursuant to the Indian Open Acreage Licensing Policy (OALP) at a total aggregate bid cost of USD 551 million. The OALP is a government-led initiative organised by the Directorate-General of Hydrocarbons. Last month, the government offered 55 oil and gas blocks for bidding and Vedanta Limited submitted bids in all 55 blocks and has been awarded 41 blocks, while the country’s largest crude oil and natural gas company - ONGC - was awarded just two blocks.
Sources told Express that Vedanta Limited will enter into a separate RSC for each of the 41 blocks. Vedanta Limited will share a specified proportion of the net revenue from each block with the Government of India from the onset of production. Pursuant to the RSCs, the average (unweighted) revenue share for the blocks shall be 33 per cent for the initial two years in the case of onshore blocks, three years in shallow water blocks or five years in deep and ultra deep water blocks. Following these initial periods, the revenue share payable to the GoI shall vary depending on the amount of revenue received. On an average, Vedanta will be paying anywhere between USD 50,000 to USD 7 million per day.