Small Fields, Big Expectations: Can India’s Discovered Small Field Rounds Deliver?
In May 2016, the Indian government launched a bidding round for Discovered Small and Marginal Fields (DSF), as part of a push to attract investments into the development of oil and gas discoveries in fields previously held by India’s National Oil Companies (NOCs) as part of their ‘legacy’ assets. The DSF round was especially significant as it was India’s first bidding round for acreage in six years (during which time upstream activity has been in decline), and it was intended to be a preamble to the country’s new open acreage licensing system (the Hydrocarbon Exploration Licensing Policy – HELP) under which the basis of the upstream fiscal regime has been fundamentally changed from a profit-sharing contract to a revenue-sharing contract. This Insight explores the following questions pertaining to the DSF round: what is the purpose and significance of the DSF round within India’s wider policy on energy? Has the outcome of the first DSF round been successful relative to historical performance? And, does the new regime adequately address the weaknesses which have encumbered India’s previous attempts at upstream exploration and production?