Ratna R-Series field which has the potential to produce USD one billion worth of crude oil every year is lying idle even though the field was awarded to a consortium way back in 1996. The field, located 90 km southwest of Mumbai in the prolific Mumbai offshore basin, has the potential to produce 25,000 barrels of crude oil per day.
Ratna R-Series field was awarded to a consortium of Essar Oil (50%), Premier Oil (10%) with ONGC accounting for remaining portion under the second round of Discovered oil fields bidding in late 1993. Both Eassar Oil and Premier Oil have reportedly written to the Ministry recently to expedite the signing of PSC. The contentious issue is regarding cess and royalty – paying cess and royalty at old rates coupled with fixed cost recovery limit (CRL) or pay the levies at current rates with updated cost recovery limit on actual investments incurred. However, the government is uncomfortable with both the proposals. If an upward revision is allowed in the Cost Recovery Limit (CRL) for the field, the government fears that would reduce the government’s take on the field. So the stalemate continues and the precious foreign exchange is wasted in imports.
