CCI clears 13 power projects, 25 oil blocks

Moneycontrol Bureau

Pushing the government's reform agenda further, the cabinet committee on investment (CCI) today cleared 13 power projects and 25 oil blocks, which will provide much needed to boost to the struggling power and oil and gas sectors. 

Out of 20 projects, CCI cleared 13 power projects worth Rs 33,000 crore, which were stuck due to various reasons including environmental concerns. About 31 oil and gas blocks worth USD 2.7 billion were stuck, of which CCI gave clearance to 25 oil blocks worth 461 crore. Of course, 16 were cleared with normal condition, 9 with special conditions and six blocks did not get clearance. 

Also read: CCEA rejects coal pool pricing scheme for now

Going further, the government further said that investment worth $1.9 will be undertaken for exploration and production (E&P) activities over the next five years.

Clearance of these blocks will come as a huge respite for upstream companies like ONGC and Reliance Industries as it will help them to go ahead with explorations.  

"Exploration and production (E&P) players those who had already signed the production sharing contract (PSC), but they have been waiting for the government approval - majority of these players are in Bay of Bengal, a few also in the West Coast, which is a good development. … Now they can atleast with the approvals in place they would be able to go ahead with the preparations like hiring rigs and hiring equipments and giving contracts and sub-contracts," Narendra Taneja, Energy Expert told CNBC-TV18.

He further added that this will also send out a good message to overseas E&P players looking to invest in India.

However, the Cabinet Committee on Economic Affairs (CCEA) once again delayed decision on coal pool pricing mechanism for imported coal by two weeks. Sources informed that a Group of Ministers headed by either P Chidambaram or Sharad Power will be constituted to look in to the coal pool pricing mechanism. The GoM will finalize the proposal on the coal pool pricing mechanism within a week.