The spat between the Ambani brothers, the global meltdown and financial and technical constraints — including a shortage of rigs — have affected the bidding process for Nelp-VIII and CBM-IV. On Monday, the last day of bidding, the directorate general for hydrocarbons (DGH) received bids for only 36 of the 70 blocks that were on offer. Australia’s BHP Biliton and UK’s BG and Cairn Energy were the only notable foreign companies that joined the bid.

Mukesh Ambani-led Reliance Industries, which recently pleaded for a three-year moratorium on exploration citing unavailability of deepwater rigs, shunned the auction, though it showed interest in one coal-bed methane block that is on auction separately. RIL has surrendered 14 blocks to the government after spending Rs 1,400 crore in unsuccessful exploration. The company had won 45 blocks in the new exploration licensing policy rounds.

Essar Oil was the most aggressive bidder, placing bids for six coal-bed methane (CBM) blocks. Arrow Energy of Australia bid for two blocks. DGH attributed the lacklustre interest in the auction of exploration blocks to the dispute between the Ambani brothers over gas pricing and supply. “The (gas) utilisation policy and the pricing are very well clarified in our Production Sharing Contract but these have been regrettably openly challenged,” director general of hydrocarbons VK Sibal told reporters.

“When you invite investment, the signals are what matter the most. We have one of the best PSCs in the world, but wrong signals have gone, resulting in what you say is a poor response,” said Sibal, whom the Anil Ambani group has charged with favouring Mukesh Ambani-led RIL.

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