The British energy firm BG (LON: BG) and Australian company BHP Billiton (NYSE: BHP) have jointly signed a deal with the Indian government to begin oil exploration on a deepwater block in the Mumbai basin. BG India and BHP Billiton currently each hold a 50 percent stake in the block, and BG is the operator.
The New Exploration Licensing Policy offered up 34 areas for exploration and production in a ninth round of bidding two years ago. Bids for 33 blocks were received by its close on March 28, 2011.
The block in question, MB-DWN-2010/1, is situated roughly 350 kilometers off the shores of Mumbai, at a depth of 2,900-3,200 meters. Surface area of the block is approximately 7,963 square kilometers.
BG also holds rights to a block in the Krishna-Godavari basin and is presently awaiting approvals before beginning further operations. In addition, BG holds 30 percent stakes in the Panna-Mukta and Mid and South Tapti oil and gas fields.
After receiving 33 bids, the Indian government has approved 16 applications, rejected 11, and is pending decisions on the rest. The eighth round awarded 235 blocks.