1 application for extension of a phase 2

20

Upload: others

Post on 21-Mar-2022

1 views

Category:

Documents


0 download

TRANSCRIPT

1 ApplicationforExtensionofaPhase 2

2 DocumentstobesubmittedwithApplicationForm 4

3 ApprovalProcedure 5

4 Annexure:a)ExtensionPolicy 7

CONTENTS

Preface

InalltheexplorationblocksunderPre-NELPandNELPregime,theexplorationperiodcomprises2or3phases.

UndertheProductionSharingContract,aprovisionhasbeenkeptforgrantingextensionupto6monthsto

enabletheoperatortofulfilthecommittedMinimumWorkProgramme,incasesucharequirementarises.

AspertheNewExtensionPolicyapprovedbytheGovernmentofIndia,extensionbeyond6monthsforaperiod

notexceeding18monthsmaybeconsidered.Theadditionaltimegrantedisutilisedtocompletethecommitted

MinimumWorkProgramme.Therefore,anydelayinsubmissionoftheapplicationforextensionorprocessingof

extensionproposalleadstotimeoverrunanddefeatstheverypurposeforwhichextensionissought.

The new extension policy approved byGovernment of India has been circulated to the operators of various

explorationblocks,fieldsandhasalsobeenpostedontheDGHwebsitefortheinformationofallconcerned.

However,despitethewidepublicitygiven,ithasbeenobservedthatoftenoperatorssubmitincompleteproposals

forextensionthatcausedelayinprocessingtheproposals.

With the objective of streamlining the processing of extension cases and to avoid delays due to incomplete

information/documents,anattempthasbeenmadethroughthishandbooktosystematizetheprocedures.The

checklistprovidedinthehandbookoutlinestherequirementofdocuments/informationtobesubmittedalong

withtheextensionproposal.

Idohopethatnoneofoperatorswillrequireextensionoftheexplorationphase.Nevertheless,intheeventthat

sucharequirementarises,thishandbookwillprovetobeavaluableguidetoalltheoperators.

(V.K.Sibal)DirectorGeneral

DGH

�� ��

format for submitting aPPlication for extension

1. background note on the block:

a) BlockName b) ConsortiumPartnersalongwithPI c) EffectiveDate d) WorkProgrammeStatus

Phase-i : ( to )

sr. no. activityWork Programme

commitment actual1 API2DinLKM2 API3DinSq.Km.3 RPinLKM4 ExploratorywellsinNos.

Phase-ii : ( to )

sr. no. activityWork Programme

commitment actual1 API2DinLKM2 API3DinSq.Km.3 RPinLKM4 ExploratorywellsinNos.

Phase-iii : ( to )

sr. no. activityWork Programme

commitment actual1 API2DinLKM2 API3DinSq.Km.3 RPinLKM4 ExploratorywellsinNos.

�� ��

e) extension History

extension no. Phase extension Period granted Vide o/o

2. reasons for not completing Work Programme in time

3. Period of extension requested under this application

4. clause of the Production sharing contract (Psc)/ new extension Policy under which the request is being made

5. time line for completing the work in Proposed extension Period

6. undertakings by contractor a) ContractoragreestotheprovisionsoftheNewExtensionPolicy b) ContractoragreestofurnishtheLiquidatedDamagesasprescribedintheNewExtensionPolicy c) ContractoragreestofurnishrequisiteBankGuaranteeasprescribedintheNewExtensionPolicy

�� ��

Documents to be submitteD along WitH aPPlication for extension

1. CopyoftheOCApprovalforExtensionPeriod;

2. CopyoftheOCApprovalforfurnishingBankGuaranteeandPaymentofLiquidated DamagesasperNewExtensionPolicy;

3. CopyoftheEnvironmentalclearance;

4. CopyoftheRighiringContractinsupportofTimelineforcompletingtheworkin ProposedExtensionPeriod;

5. Iftherequestforextensionisduetodelayingettingstatutoryclearances/permits,thenthefollowing documentsmaybesubmitted:

Copyoftheapplicationmadefortheclearance;

Copyoftheclearancereceived;

CopyofthefortnightlyreportsubmittedtoDGH.

�� ��

ProceDure for aPProVal of extension ProPosal

if minimum Work Programme is not completed or additional Work Programme is desired to be carried out during the duration of the exploration phase, contractor can request for:

a) Extensionupto6monthsasperPSCprovisions; b) Furtherextensionfrom6to18monthswithBankGuaranteeand/orpre-estimatedliquidated damagesonthecostofUnfinishedWorkProgramme.

Procedure for approval of extension Proposal:

Following3tierapprovalprocedurewithtimeframewillbeadopted:

steps time frame

1st tier: 6 days

ProposalfromtheContractorwillbeexaminedbytheCommitteeconsistingof: 2days

i)NodalOfficer;

ii)RepresentativeofLegalCell;

iii)RepresentativeofContractFinance;

iv)RepresentativeofStatutoryClearanceCommittee,(iftheproposalisfordelayinstatutoryclearance);

Abovecommitteewillgiveitsrecommendationscitingrelevantprovisionsunderwhichproposalisaccepted/rejectedandcostofunfinishedWorkProgramme,ifany.

Ifapplicable,NodalofficerswillwritetoContractorontheamountofBankGuaranteeandpre-estimatedliquidateddamagesneededtobesubmittedforfurtherprocessingoftheproposal.

4days

2nd tier: 5 days

Ifthecaseisapprovedat1sttier,proposalwillbemarkedtothecoordinator;

Coordinator will examine the proposal along with all relevant documents. If herecommendstheproposal,ManagementCommitteeMeetingwillbeconvened;

1day

ProposalwillbediscussedintheManagementCommitteeMeetingforrecommendations. 4days

3rd tier: 1 day

Ifthecaseisapprovedat2ndtier,proposalwillbemarkedtoChiefCoordinator;

�� ��

Chiefcoordinatorwillexaminetheproposalalongwithallrelevantdocuments.Ifherecommendstheproposal,thesamewillbeputuptoDG,DGHforapproval.

1day

issuance of the office order granting extension: 3 days

DraftofficeordergrantingtheextensionwillbepreparedbyNodalofficer 1day

Draft order will be vetted by coordinator, legal, Contract Finance and StatutoryClearanceCommittee(ifapplicable).

1day

DraftorderwillbecheckedbyChiefCoordinatorandputtoDG,DGHforapproval. 1day

How to apply for extension

1. RequestforExtensionmustbemade45daysinadvance;

2. RequestforExtensionmustbemadeontheprescribedformat;

3. Documentsoutlinedarerequiredtobesubmittedalongwiththeapplication.

�� ��

annexure-1

PolicY for extension of exPloration PHases unDer nelP anD Pre-nelP ProDuction sHaring contracts

TheGovernmentofIndiahassignedover100productionsharingcontracts(PSCs),whicharecurrentlyvalid and are at various stages of exploration. These have been signed within the framework of NewExploration Licensing Policy (NELP) and Exploration Policy adopted prior to NELP. These contractsgenerallyprovidedextension inexplorationphases foraperiodof6months tocomplete theunfinishedMinimumWorkProgrammeandalsoprovided6monthsextensiontocompleteawellunderdrilling.Theobjectiveoftheexplorationpolicieshavebeentostimulateexplorationofoilandgasinthecountry.Inthelastfewyears,itwasobservedthatanumberofproposalsseekingextensioninexplorationphaseswerereceivedbytheGovernmentcitingnumerousreasons.TheGovernmenthavebeenconsideringthecasesonmeritofindividualproposals.

Thenon-completionofcommittedWorkProgrammewithinthescheduledtimeasspecifiedintherespectiveProductionSharingContractshasseveraltangibleandintangibleeffectsontheentireprocessofexplorationendeavors.Someofthemajorimplicationsare:

(a) Theverypurposeofacceleratingandincreasingtheefficiencyinexplorationwillbedefeatedanditmaytriggercomplacency.

(b) TheblocksareawardedonthebasisofPhase-wisecommittedWorkProgrammealongwithtimeframe.Extensionsvitiatetheintegrityofthebiddingprocessandspiritofcontracts.

(c) Theprincipalaimofequalopportunity,fairchancestoall,transparencyofthesystemisaffectedbyfrequentextensions.

in order to adopt a transparent and consistent framework for granting extension in exploration phases, the government has framed an extension policy for considering proposals, which are either pending with the government or may be received in future. the broad objective of the extension policy are as under:

i) To have a transparent and consistent set of criteria to take decisions on extension proposals ofthecontractors.

ii) Toactasdeterrentforthoseoperatorsseekingunnecessaryextensionsorholdingontheacreageswithoutdoinganyexplorationactivitiesoractivityatslowpace.

iii) ThepolicyenvisagesasystemofprogressivepenaltybywayofincreasingBankGuaranteeamountand/orcashpaymentasagreed,pre-estimatedliquidateddamages(mutuallyagreedpre-estimatedamountofliquidateddamages)vis-à-visdurationofextensionsoughtandgivingduerecognitiontothecompanieswhohavemadediscoveriesandhaveunderstoodthegeologyoftheblockapartfromencouragementtoadditionalexplorationprogramme.

iv) Upto6monthsextensionmaybegivenbytheManagementCommitteeortheGovernmentonmeritintermsoftheprovisionsoftherespectivePSCs.

v) DemonstrabledelaysonaccountofgettingtheGovernmentapprovals/permits/clearanceswillbecountedasexcusabledelays.

�� ��

vi) Incase,thecontractordoesnotfulfilltheWorkProgrammewithinthestipulatedperiodorextendedperiod,asmaybethecase,shallberequiredtopaymoneyfortheunfinishedWorkProgramme,ifany,totheGovernmentintermsoftherespectiveprovisionsofthePSC.

With the broad objectives in view, the government has decided to put in place the following policy for grant of extensions. the proposals falling in various categories enumerated below in the table will be considered by the government as per the respective terms and conditions stipulated against each such category.

a. extension within the overall exploration period of 7 years or 8 years in phase-i & ii (but excluding any proposed excusable delays on account of the government approvals / permits / clearance etc.)

sl. no.

1.

type of proposal (applicable for extension in Phase i & ii)

Where MinimumWork Programme(MWP) of therelevant phase hasnotbeencompletedwithin thestipulated periodof that phase andno hydrocarbondiscovery (asdefined in thePSC)made:

suggestion along with proposed conditions

WhereMWPhasnotbeencompletedandnohydrocarbondiscoveryhavebeenmadebythecontractor,thefollowingprocedureshallapply:

a) First6monthsextensionmaybegrantedbyMCortheGovernmentintermsoftheprovisionsofrespectivePSCsmaintainingthesametermsandconditionsofthePSCs.

b) An additional upto 6 months extension (that is between 6 – upto 12months)maybegrantedonthefollowingtermsandconditions:

The contractor will provide 100% Bank Guarantee and 10% cashpayment as agreed preestimated liquidated damages for theunfinished Minimum Work Programme as reasonably determined byDGH, keeping in view the relevant factors in computing cost of suchunfinishedMinimumWorkProgramme.

ThecontractorwouldberequiredtorelinquishtheareaintermsoftheprovisionsofthePSCatthebeginningofthisextensionperiod.

Thisperiodofextensionwillbesetofffromthenextexplorationphase.

c) Anyextensionbeyond12monthsandupto18monthsmaybeconsideredsubjecttothefollowing:

Thecontractorwouldberequiredtorelinquishtheareaasapplicableattheendofrelevantphase.

The contractor would be required to give 100% Bank Guaranteefor unfinished Minimum Work Programme and deposit a cashpaymentasagreedpre-estimatedliquidateddamagesof30%oftheunfinishedMinimumWorkProgrammeasreasonablydeterminedbyDGH,keepinginviewtherelevantfactorsincomputingcostofsuchunfinishedMinimumWorkProgramme.

Thisperiodofextensionwillbesetofffromthenextexplorationphase.

�� ��

2. Where MWPhas not beencompleted withinthe stipulatedperiod of anexploration phaseand the operatorfeels that theprospectivityistoopoor to undertakefurtherexploration/drilling:

IncasethecontractorandDGH,basedonavailableinformationatthattime,cometoaconclusionthattheprospectivityoftheblock/areaispooranddoesnotwarrantcompletionofMWP(saydrillingofexplorationwellsduetolackoftechnocommercialviableprospects),DGHwillreasonablydecidebasedontheavailableinformationwhethertheprospectivityoftheblockisindeedpoorandalsodetermineanalternativeWorkProgrammeinconsultationwiththecontractor,whichwillbeatleastequalintermsof investmentandeffort(inphysicalterms)oftheunfinishedMinimumWorkProgramme.SuchsubstitutionofWorkProgrammewouldrequiretheGovernmentsapproval.

In this scenario with a substitute Work Programme, extension may begrantedasunder:

a) For the first 6 months by the Management Committee or theGovernmentintermsoftheprovisionsofrespectivePSCsmaintainingsame terms and conditions of the PSCs (except for unfinishedsubstitutedWorkProgrammetobeapprovedbytheGovernment).

b) Next6monthsextension(i.e.6-upto12months)maybegrantedonthefollowingtermsandconditions:

Thecontractorwillprovidea100%BankGuaranteeoftheunfinishedMinimumWorkProgramme(equivalentunfinishedsubstitutedWorkProgrammetobeapprovedbytheGovernment).

Theblockwillcomeinthedomainofopenacreageandmaybeofferedinabiddingroundorunderopenacreagesystem(asandwhenitcomesinforce).However,incaseofanydiscoveryoranydrillingunderimplementationduringthisperiod,thecontractorwillhavetherighttoretainsuchareasasreasonablydeterminedbyDGH.Incasethecontractorasaresultofexplorationduringthisextendedperioddesirestogotothenextphaseofexploration,the contractor would be allowed to proceed to the next phasefor only such areas for which no licenses / leases have beenissuedorwhichhasnotbeenplacedunderabiddingprocessbysuchtime.

No further extension will be given beyond 12 months and thecontractor shallbe required to relinquish the entireareaalongwith payment, if any, equivalent to the unfinished minimumWorkProgramme,totheGovernmentintermsoftheprovisionsofthePSCs.

1110 1110

3. Where MWP hasnotbeencompletedbut a hydrocarbondiscovery ismade within theexploration phaseand does not wantto relinquish thearea at the end ofphase:

Inthisscenario,DGHwillreasonablydecidetheWorkProgramme,inadditiontotheunfinishedMinimumWorkProgramme,requiredtobecarriedoutintheareawhichisnotproposedforrelinquishmentbythecontractor.Thefollowingextensionmaybegranted:

First6monthsextensionmaybegivenintermsoftheprovisionsoftherespectivePSCs.

Anotherextensionofupto12months(i.e.6to18months)maybegivensubjecttothecontractorproviding50%BankGuaranteeoftheunfinishedMinimum Work Programme and the additional Work Programme(forretainingadditionalarea)reasonablydecidedbyDGH.

The contractor would undertake to appraise, decide oncommercialityanddevelopmentofthediscoverywithinthetimeframeprovidedinthePSCsfortheseactivities.

4. Where MWP hasbeencompletedwithno hydrocarbondiscovery andadditional WorkProgramme isproposed:

Inthisscenario,thecontractormaybegivenextensionasunder:

a)6 months extension may be given in terms of the provisions ofthePSC.

b)Additionalupto6months(6to12months)extensionmaybegivensubjecttothefollowing:

ThecontractorwillprovideBankGuaranteeof35%amountoftheunfinishedadditionalWorkProgramme.

Willnotbeable to setoff thisWorkProgramme fromsubsequentphase(s).

DGH will reasonably determine the expected time required forcompletingadditionalWorkProgramme.

c)Anotherupto6months(12-upto18months)extensionmaybegrantedsubjecttothefollowing:

ThecontractorwillprovideBankGuaranteeof100%amountoftheunfinishedadditionalWorkProgramme.

Wouldberequiredtorelinquishtheareaasapplicablefortherelevantphase.

WillnotbeabletosetoffthisWorkProgrammefromthesubsequentphase.

DGH will reasonably determine the expected time required forcompletingadditionalWorkProgramme.

IncaseofbeingunabletocompletetheadditionalWorkProgrammewithinthisperiod,thecontractorwillpayfor50%oftheunfinishedadditionalWorkProgramme

1110 1110

5. Where MWP hasbeen completedand hydrocarbondiscovery has beenmade and thecontractor wantsto retain the areafor additionalexploration:

Inthisscenario,theextensionmaybegrantedinthefollowingmanner:

a)6monthsextensionmaybegivenintermsoftheprovisionsofthePSCs.

b)Additionalextensionofupto12months(6–upto18months)maybegivensubjecttothefollowing:

DGH will reasonably determine the estimated time required forcompletingadditionalexplorationWorkProgramme.

Thecontractorwouldbe required togiveaBankGuaranteeof35%amountoftheunfinishedadditionalWorkProgramme.

Will not be able to set off this Work Programme from subsequentphase.

In case the contractor is unable to complete the additional WorkProgrammewithinthisperiod,thecontractorwillpayfor50%oftheunfinishedadditionalWorkProgramme.

1�1� 1�1�

6. Where MWP hasbeen completedand hydrocarbondiscovery has beenmade and thecontractoriswillingto relinquish thearea as per PSC,however, wantsextension to carryout additionalexploration:

Inthisscenario,theextensionmaybegrantedinthefollowingmanner:

a)6monthsextensionmaybegivenintermsofthePSCs.

b)Additional6months(6–upto12months)extensionmaybegivenonthefollowingconditions:

DGH will reasonably determine the estimated time required forcompletingadditionalWorkProgramme.

Will not be able to set off this Work Programme from subsequentphase.

The contractor would be required to give a bankguarantee of 35%amountoftheunfinishedadditionalWorkProgramme.

IncaseunabletocompletetheadditionalWorkProgrammewithinthisperiod, the contractorwill pay for35%of the unfinished additionalWorkProgramme.

c)Another6months(12-upto18months)extension(beyond12months)maybegrantedsubjecttothefollowing:

DGH will reasonably determine the estimated time required forcompletingadditionalWorkProgramme.

ThecontractorwouldberequiredtogiveaBankGuaranteeof50%oftheunfinishedadditionalWorkProgramme.

Will not be able to set off this Work Programme from subsequentphase.

In case unable to complete the additional Work Programme withinthis period, the contractor will pay for 50% of the unfinishedMinimumWorkProgramme.

1�1� 1�1�

7. Blocks fallingin unprospectivearea, MWP hasnotbeencompleted(these may beblocks,whichwereawardedonasinglebidbasis):

Inthisscenario,theextensionmaybegrantedinfollowingmanner:

a)6monthsextensionmaybegivenintermsoftheprovisionsofthePSCs.

b) Another upto 12 months (6-upto 18 months) extension may be givensubjecttothefollowing:

DGHtodeterminewhethertheblockfallsinunprospectiveareaalongwiththesupportingdocuments/data.

DGHtoreasonablydeterminethetimeforcompletingtheunfinishedMinimumWorkProgramme.

The contractor will provide Bank Guarantee of 50%amount of theunfinishedMinimumWorkProgramme.

ThecontractorwillrelinquishtheareaintermsoftheprovisionsofthePSCatthebeginningofthisextensionperiod.

Theblockwillcomeinthedomainofopenacreageandmaybeofferedinabiddingroundorunderopenacreagesystem(asandwhenitcomesinforce).However,incaseofanydiscoveryasaresultofWorkProgrammeunder implementation during this period, the contractor will have theright to retain the relevant discovery areas as reasonably determinedbyDGH/MC.Incase,thecontractorasaresultofexplorationduringthisextendedperioddesirestogotothenextphaseofexploration,thecontractorwouldbeallowed toproceed to thenextphaseprovidednolicenses/leaseshavebeenissuedortheareahasnotbeenofferedunderbiddingprocessatthetime.

WillberequiredtopayequivalentamountoftheunfinishedMinimumWorkProgramme,ifMWPisnotcompletedintheextendedperiod.

1�1� 1�1�

8. Block falling inunprospective areaand MWP havebeen completedbut the contractorwantstoretainthearea to carry outadditional work(these may beblocks,whichwereawardedonasinglebidbasis):

in this scenario, extension may be given in the following manner :

a)6monthsextensionmaybegivenintermsoftheprovisionsofthePSCs.

b)Another12months(6-upto18months)extensionmaybegivensubjecttothefollowing:

DGHtodeterminewhethertheblockfallsinunprospectiveareaonthebasisofsupportingdocuments/data.

DGHtoreasonablydeterminethetimeforcompletingtheunfinishedadditionalWorkProgramme.

The contractor to provide Bank Guarantee of 35% amount of theunfinishedMinimumWorkProgramme.

ThecontractortorelinquishanyareaintermsoftheprovisionsofthePSCatthebeginningofthisextensionperiod.

ThecontractorwillnotbeabletosetofftheadditionalWorkProgrammefromthenextphase.

Theblockwillcomeinthedomainofopenacreageandmaybeofferedinabiddingroundorunderopenacreagesystem(asandwhenitcomesinforce).However,incaseofanydiscoveryasaresultofWorkProgrammeunderimplementationduringthisperiod,thecontractorwillhavetherighttoretaintherelevantdiscoveryareasasreasonablydeterminedbyDGH/MC.Incase,thecontractorasaresultofexplorationduringthis extended period desires to go to the next phase of exploration,thecontractorwouldbeallowedtoproceedtothenextphaseforsuchremainingareaasisstillopeni.e.nolicenses/leaseshavebeenissuedorhasnotbeenofferedunderanybiddingprocessatthetime.

Will be required to pay 50% of the equivalent amount of theunfinishedadditionalworkprogramme,ifMWPisnotcompletedintheextendedperiod.

1�1� 1�1�

b. extension beyond exploration period i.e. after exploration phase–iii (but excluding any demonstrable condonable delays on account of getting the government approvals / clearances / permits etc.)

sl. no. type of proposal suggestion along with proposed conditions

1 Extension soughtto complete MWPofphase-IIIandnodiscoverymade:

Asthecontractorhasnotbeenabletomakeanydiscoveryevenin7or8years and has also not been able to complete the MWP of phase-III, noextensionshallbegivenandcontractorsshallberequiredtopaythemoneytotheGovernmentintermsoftheprovisionsofthePSCs.

2 Where MWP havebeen completed,no hydrocarbondiscoverymadeandcontractorwantstocarryoutadditionalWork Programmeandretainthearea:

Upto 12 months of extension may be given on the following terms andconditions:

The contractor will provide 100% Bank Guarantee and 30% cashpaymentasagreedpre-estimatedliquidateddamagesfortheadditionalWorkProgramme.

TheContractorwouldberequiredtoretainonlyminimumareaalongwithjustificationandreasonabilityoftheWorkProgrammealongwithproposedextensionperiod.ThisistobedecidedbytheGovernmentinconsultationwithDGH.

Noassignmentofparticipatinginterest(PI)shallbepermittedduringtheextendedperiod.

Theblockwillcomeinthedomainofopenacreageandmaybeofferedinabiddingroundorunderopenacreagesystem(asandwhenitcomesinforce).However,incaseofanydiscoveryasaresultofWorkProgrammeunder implementation during this extended period, the contractor willhavetherighttoretaintherelevantareasasreasonablydeterminedbytheGovernmentinconsultationwithDGH.

In case of pre-NELP PSCs, the contractor (in place of NOCs) will be thelicensee/ lesseeafterexpiryofexplorationperiodandwillbeliableforallstatutoryleviesandotherobligationsunderthePSCs/laws.OthertermsandconditionsofthePSCsshallremainunchanged.

1�1� 1�1�

3. Extension soughtto complete MWPof phase III buth y d r o c a r b o ndiscoverymade:

Inthisscenario,extensionmaybegivenonthefollowingconditions:The contractor will provide 100% Bank Guarantee and 30% cash

paymentasagreedpre-estimatedliquidateddamagesfortheunfinishedMinimumWorkProgramme.

TheContractorwouldberequiredtoretainonlyminimumareaalongwithjustificationandreasonabilityoftheWorkProgrammealongwithproposedextensionperiod.ThisistobedecidedbytheGovernmentinconsultationwithDGH.

Noassignmentofparticipatinginterest(PI)shallbepermittedduringtheextendedperiod.

Theblockwillcomeinthedomainofopenacreageandmaybeofferedin a bidding round or under open acreage system (as and when itcomesinforce).However,incaseofanydiscoveryasaresultofWorkProgramme under implementation during this extended period, thecontractorwillhavetherighttoretaintherelevantareasasreasonablydeterminedbytheGovernmentinconsultationwithDGH.

Incaseofpre-NELPPSCs,thecontractor(inplaceofNOCs)willbethelicensee/lesseeafterexpiryofexplorationperiodanditwillbeliableforallstatutoryleviesandotherobligationsunderthePSCs/lawsandothertermsandconditionsofthePSCsshallremainunchanged.

Thecontractorwouldberequiredtoenter intoseparateringfencedPSCsforexplorationareasw.e.f.thedateofextension.

4. Where MWP havebeen completed,d i s c o v e r i e s /c o m m e r c i a ldiscoveries havebeen made andcontractorwantstocarryoutadditionalexploration WorkProgramme andretainthearea:

Inthisscenario,extensionmaybegivenonthefollowingconditions:The contractor will provide 35% Bank Guarantee and 30% cash

paymentasagreedpre-estimatedliquidateddamagesfortheadditionalWorkProgramme.

TheContractorwouldberequiredtoretainonlyminimumareaalongwithjustificationandreasonabilityoftheWorkProgrammealongwithproposedextensionperiod.ThisistobedecidedbytheGovernmentinconsultationwithDGH.

Noassignmentofparticipatinginterest(PI)shallbepermittedduringtheextendedperiod.

Theblockwillcomeinthedomainofopenacreageandmaybeofferedin a bidding round or under open acreage system (as and when itcomesinforce).However,incaseofanydiscoveryasaresultofWorkProgramme under implementation during this extended period, thecontractorwillhavetherighttoretaintherelevantareasasreasonablydeterminedbytheGovernmentinconsultationwithDGH.

Incaseofpre-NELPPSCs,thecontractor(inplaceofNOCs)willbethelicensee/lesseeafterexpiryofexplorationperiodanditwillbeliableforallstatutoryleviesandotherobligationsunderthePSCs/lawsandothertermsandconditionsofthePSCsshallremainunchanged.

ThecontractorwouldberequiredtosignseparateringfencedPSCforexplorationareaanddiscoveredareasw.e.ftheextendeddate.

1�1� 1�1�