Govt launches Offshore Bidding Round 2026 for 26 blocks, revises PSC to boost investment

The government today (24 May) formally launched the Offshore Bidding Round 2026, offering 26 offshore blocks in the Bay of Bengal alongside a revised production sharing contract (PSC) framework aimed at attracting international investment while strengthening energy security.

Speaking at a press conference at the Secretariat today, Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood Tuku said the country had suffered in the past by leaving domestic energy resources unexplored while becoming increasingly dependent on imported fuel.

Under the new Offshore Model PSC 2026, the government has opened bidding for 11 shallow sea blocks and 15 deep sea blocks, with a range of investor-friendly provisions designed to improve competitiveness in the global energy market.

These include permission for third-party gas sales, conditional gas export rights, pipeline tariff mechanisms and enhanced investment protection clauses. 

Officials said the revised framework was designed after earlier bidding rounds failed to attract major international oil and gas companies.

Under the Offshore Bidding Round 2026, companies may apply for individual blocks, while joint applications will be allowed for two adjacent deep sea blocks under a single contract.

The government has also introduced promotional and data packages for investors, although participation requires purchasing bid documents.

Officials said the revised PSC includes internationally benchmarked fiscal terms, allowing contractors to sell gas to third parties and export under specific conditions, along with mutually agreed pipeline tariff structures based on distance, depth and volume.

It also introduces stabilization and expropriation protection clauses, alongside provisions for commercial discovery bonuses, production incentives, R&D fees, service fees and training grants.