Saturday, October 12, 2013

State govt. ignores MPNG on oil rules.

Not withstanding the directive of the Ministry of Petroleum and Natural Gas (MPNG) to the government of Nagaland, to rescind/withdraw the Nagaland Petroleum and Natural Gas Rules 2012; the NPF-led DAN government has decided to proceed with signing Memorandum of Understanding (MoU) with five firms short listed.

It may be recalled that the Union Ministry of Petroleum and Natural Gas, had on June 8,2013 written to the state government to rescind the NPNG Rules 2012 as Article 371(A) did not provide powers to the state assembly to frame its own laws “ to regular and develop mineral oil”.

It may be noted that on March 10, 2010 union minister of state for petroleum and natural gas R.P.N. Singh asserted in the Lok Sabha that Nagaland government has the power to frame its own laws on the matter under Article 371(A).

The state assembly passed a resolution  on July 26, 2010  to Article 371(A), Clause VII-(iv) wherein “ownership of land and its resources” would include minerals, petroleum and natural gas etc.

(According to sources, the resolutions  of the state assembly on Article 371(A) required the nod or assent of the President of India to become constitutionally valid.) 

Subsequently, following the cabinet resolution on September 13,2012, the state government introduced The Nagaland Petroleum and Natural Gas Regulations,2012 which was passed by the state assembly on September 22,2012.

The state then floated tender for Expression of Interest (EoI) for oil operations in Nagaland under the Nagaland Petroleum and Natural Gas Regulations 2012. 

However following the directive of the union ministry of petroleum and natural gas on June 8,2013, the process for finalization of firms and signing of MoUs for oil exploration came to a halt.

In response, the state government organized a consultative meeting with a wide spectrum of present and former legislators and MPs, public leaders and tribal organizations over Article 371(A) on July 12,2013. 

The tone of the resolution later echoed in the state assembly on July 22,2013, wherein it resolved to protect the rights of the Nagas as enshrined under Article 371(A). 

After the assembly resolution on July 22,2013, the state government decided to go ahead with the oil operations under NPNG Rules 2012.

It was learnt that there were 23 bidder for the Expression of Interest (EoI) floated in national dailies  after which the Gas Board (the second in the three-tier structure) opened the bids on January 10,2013 ahead of the February 23,2013 assembly election. The list was then narrowed it down to seven and finally to five.

According to sources, the five that were short listed included-- Assam Company India Ltd (which bid for Wokha and Mon); Prize Petroleum Ltd (no specific zone); Deep Industries Ltd. (for Wokha, Mokokchung and Mon) and Shivani Oil & Gas Exploration Ltd. (no zones specified ) and Jubilant Oil & Gas Exploration Pvt. Ltd (made conditional offer that if Wokha was not given, then its offer for Peren and Dimapur would be invalid). 

Interestingly, according to one report, M/s Metropolitan Oil & Gas Pvt.Ltd (MOGPL) which did not figure among the last-five selected firms, was tipped to get Peren and Wokha zones. MOGPL was not among the short listed firms. 

The report claimed that MOGPL was found to be “ a very newly constituted company and does not have any presence in the Oil & Gas sector in India, particularly in exploration and production activities.” 

Interestingly, the report claimed that shareholders of MOGPL were SRM Exploration Pvt. Ltd.,( which was under liquidation) and Spice Energy. Another firm was tipped to get Mokokchung and Dimapur though it was not among those short listed. 

The selected companies have been invited to submit permit fee and Corporate Social Responsibility reports and given 21 days from the date of issue of offer letters for negotiations. 

After that, the firms will sign MoUs with the Ministerial Group, headed by the Chief Minister for issue of permits. 

The landowners of oil bearing lands in Peren district have objected to issuance of  by the Zeliangrong Baudi. 

While Kyong Hoho is under crisis, the Ao Senden has rejected any oil activities in Mokokchung district. On Dimapur, the interesting point is which hoho, if at all, will issue NoC?