India to launch third round of discovered small fields auctions on May 17

India is set to launch the third round of discovered small field (DSF-III) auctions on May 17, in which over 30 hydrocarbon fields are expected to be on offer for private players.

“At least 32 contract areas will be on offer under DSF-III. This includes 22 offshore and 10 onshore fields, which may have reserves to the tune of around 250 million metric tonnes of oil equivalent,” a source said Moneycontrol.

When asked, a senior official from the Directorate General of Hydrocarbon declined to comment.

DSF rounds are considered as an entry point for India’s potential oil and gas barons, by offering small blocks that were surrendered by the Oil and Natural Gas Corporation (ONGC) and Oil India (OIL).

By 2022, these rounds were also intended to reduce India's oil imports by 10 per cent.

“After DSF Bid Round-I (2016) & DSF Bid Round-II (2018), the Government is coming up with DSF Bid Round-III (2021) where unexploited discoveries will be offered for International Competitive Bidding,” DGH said in a Tweet.

During the first round of DSF held in 2016, 22 companies won bids for the 31 contracts on offer; of them, 15 were new entrants to the oil and gas business.

Interestingly, companies from sectors as diverse as steel, power, software, iron ore, textile and education turned up to bid.

However, during the second round, 23 contract areas were awarded to eight companies.

The participation of ONGC and OIL during the second round had raised eyebrows as the blocks were previously surrendered by the same companies.

None of the blocks from the first two rounds have started production yet, with some still stuck in getting clearances from the environment, forests, and wildlife departments.

While production from the first round was expected to start by 2019-20, those from the second round were scheduled to begin by 2022. Due to the COVID-19 related delay, production from these blocks is expected to be delayed.