Year that saw oil, gas production switch to revenue-sharing mode

sharing contracts (PSC) that had governed the bidding in nine earlier New Exploration Licensing Policy (NELP) rounds. The PSC regime, which allows operators to recover all investments made from sale of oil and gas before profits are shared with the government, was criticised by India’s official auditor, who said it encouraged companies to keep inflating costs to postpone the sharing of profits. The Open Acreage Licensing Policy (OALP) launched by the government in July allowed oil and gas companies to select exploration blocks on their own, without waiting for a formal bid round from the government. It replaced the old system of the government carving out areas for bidding them out. As a necessary complement to the OALP, the country’s first national data repository (NDR) was also launched which allows explorers to access seismic data on the sedimentary basin before making their bids. The reforms in the sector in a bid to raise output comes in the current difficult context for the global oil industry caused by crude prices falling sharply from the highs of over $120 a barrel that prevailed two years ago. Which leads to the other story of the year, whereby oil regained the $60 a barrel level, from lows of around $25, after the Organisation of the Petroleum Exporting Countries (OPEC), along with non-OPEC producers, put in place output cuts from 1 Januaryto counter the fall in prices caused by a supply glut.