Oil and Natural Gas Corp, India's state-run explorer, will allow British gas producer BG Group to exit three exploration blocks off the country's east coast, ONGC Chairman Sudhir Vasudeva told reporters on Wednesday.
The British company will pay ONGC $50 million for failing to fulfil drilling commitments. ONGC will now operate the blocks, and drilling at one of them -- Mahanadi block -- will start next month, Vasudeva said.
"All these multi-national companies keep on reshuffling their portfolios. They keep on consolidating. So, it as per their strategy," Vasudeva said.
"It is a commitment to minimum work progress under the production sharing agreement. These understandings are for our own economic consideration," said S.V. Rao, director exploration of ONGC.
Earlier, ONGC said it had found four new potential hydrocarbon reserves in the country's west and northeast.
The new finds will take ONGC's total number of discoveries in 2011/12 to 15. The new discoveries have been made in Assam and Gujarat.