OREANDA-NEWS. July 26, 2011. Reliance Industries (RIL) said it would pursue with the government to resolve issues that had held up approval for its stake sale in two exploration blocks to UK's BP Plc. The government had last week approved BP Plc acquiring 30% stake in 21 of the planned 23 oil and gas blocks of RIL for USD 7.2 billion.

"RIL has been informed that the Cabinet Committee of Economic Affairs has given its approval to the proposal of RIL to assign 30% of its interest to BP Exploration (Alpha) in 21 out of 23 Blocks," the company said in a statement.

"RIL will pursue with the Government to resolve the issues, if any, concerning the balance two blocks," it added. Oil Minister S Jaipal Reddy had announcing the CCEA decision on July 22 stated that "for technical reasons, we did not recommend [sale of interest in] two other blocks".

Approval for stake transfer in the inconsequential blocks where no oil and gas discovery has yet taken place, would be done by the Oil Ministry once issues like the status of exploration are sorted out, he had stated.

Sources said oil regulator DGH and RIL were in disagreement over the status of exploration in deepwater block NEC-DWN-2002/1 in Bay of Bengal and Assam onland block AS-ONN-2000/1.

In NEC-DWN-2002/1, RIL had taken an extension of Phase-I of its exploration campaign. In the meanwhile, the government recently announced rig moratorium, allowing firms more time to fulfil their drilling commitments which they had previously not met due to global shortage of drilling rigs.

Since NEC-DWN-2002/1 was covered by rig moratorium, RIL sought to withdraw the exploration extension it had availed as per the exploration extension policy of the government but DGH and Oil Ministry said no to it, sources said, adding, it is not clear if the block was in Phase-I or Phase-II of exploration.

In Assam block AS-ONN-2000/1, there is a disagreement over whether RIL had completed its Phase-I work programme and entered Phase-II. While RIL had drilled a well on NEC-DWN-2002/1, it was planning to do so on Assam block shortly. The well on NEC-DWN-2002/1 was dry, that is, it did not lead to any oil or gas find, they added.