An occasion when a governmental body offers exploration acreage for leasing by exploration and production companies, typically in return for a fee and a performance or work obligation, such as acquisition of seismic data or drilling a well. Exploration licences are initially of limited duration (about 5 years) after which there might be a requirement to return half or more of the licenced acreage to the state. If hydrocarbons are discovered, a separate production licence or production-sharing agreement is usually drawn up before development can proceed.