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In Search Of Bidders

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[The ongoing feud between the Ambani brothers will impact the New Exploration Licensing Policy (Nelp), say sources in the directorate-general of hydrocarbons (DGH). The next round of Nelp — Nelp VIII — offers 70 oil and gas blocks for auction. The government has extended the last date for bidding to 12 October, and, if sources in the petroleum ministry are to be believed, it is likely to be extended further "as the current controversy is not a good sign to attract foreign investors". While the battle between Reliance Industries and Anil Dhirubhai Ambani Group on gas pricing has put off foreign investors, the government's assertion that no company can claim ownership of ‘a national resource' has also created discomfort amongst the private oil and gas companies, says a senior executive of a foreign oil and gas company, which had bid in Nelp VII.The petroleum ministry has planned road shows in India and abroad to attract investors. According to DGH sources, the response to the roadshows will determine whether the October deadline will be adhered to. The government has clarified that gas producers will get tax holiday for seven years, but there is no clarity on whether they will be exempt from service tax. However, some analysts are optimistic. "Most of the issues have been cleared, but a few remain that are minor, and this round should see good bids from foreign players," says Ajay Arora, partner for transaction advisory services at Ernst & Young. A "good bid", however, is dependent on market sentiments. <script type="text/javascript"> var intro = jQuery.trim(jQuery('#commenth4').text()) var page = jQuery.trim(jQuery('#storyPage').text()) if (page.indexOf(intro) < 0) { jQuery('#commenth4').attr('style', 'display:block;') } </script> (This story was published in Businessworld Issue Dated 17-08-2009)