Executive Summary:
This document responds to Lok Sabha Unstarred Question No. 3184, addressing steps to boost domestic crude oil and natural gas production and reduce import dependency. It details government policies, private sector participation in exploration, and clarifies the role of private companies versus ONGC. The response also addresses concerns regarding the potential sale of stakes in producing fields.
Key Points / Main Content:
Government Initiatives to Boost Domestic Production:
* Implemented policies under the Production Sharing Contract (PSC) regime.
* Introduced the Discovered Small Field Policy (2015) and Hydrocarbon Exploration and Licensing Policy (HELP, 2016).
* Extended PSCs and promoted early monetization of Coal Bed Methane.
* Established a National Data Repository (2017) and approved appraising unassessed areas under the National Seismic Programme (2017).
* Implemented policies to incentivize Enhanced Recovery Methods of Oil/Gas (2018) and for exploration/exploitation of Unconventional Hydrocarbons (2018).
* Enacted Natural Gas Marketing Reforms (2020).
* Offered lower royalty rates and incentives in OALP Blocks.
* Released approximately 1 Million Sq. Km of No-Go offshore areas.
* Amended the Oilfields Regulation and Development Act, 1948.
Private Sector Participation:
* Four private sector companies participated in OALPVIII and OALPIX rounds.
* More than 15 private oil companies are engaged in exploration activities across the country.
* Capital intensity, inherent risks, and price volatility can deter private sector participation.
* Government has introduced policy reforms to address these issues and enhance ease of doing business.
Exploration Output:
* In 2023-24, ONGC drilled 103 exploratory wells, while private companies drilled 11.
Stake in Producing Fields:
* There is no current proposal to offer a 60% stake and operatorship in producing fields like Mumbai High and Bassein Satellite to international partners.
Impact Analysis:
Oil and Natural Gas Companies (Public and Private):
* Impact: Affected by policies and incentives designed to increase domestic production and reduce import dependency. Subject to regulatory changes and exposed to market volatility.
* Action Required: Evaluate and adapt to new policies, assess investment opportunities in exploration and production, and manage risks associated with fluctuating commodity prices.
Government (Ministry of Petroleum and Natural Gas):
* Impact: Responsible for implementing and refining policies to achieve energy security goals. Must balance promoting private sector investment with maintaining domestic control and revenue.
* Action Required: Monitor the effectiveness of existing policies, address challenges faced by the private sector, and ensure a stable regulatory environment.
Investors in the Energy Sector:
* Impact: Decisions influenced by policy changes, market dynamics, and the participation of private companies.
* Action Required: Stay informed about policy updates, assess the viability of projects, and manage risks related to investment in the oil and gas sector.
Citizens/Consumers:
* Impact: Could benefit from increased domestic production leading to greater energy security and potentially more stable prices.
* Action Required: No direct action, but may benefit from awareness of government policies and energy market trends.
Key Entities Referenced
PETROLEUM AND NATURAL GAS: The Ministry responsible for policies related to petroleum and natural gas.
Open Acreage Licensing Policy (OALP): A policy for awarding exploration rights to companies for oil and gas exploration.
ONGC: Oil and Natural Gas Corporation, a public sector oil and gas company.
Mumbai High: An offshore oilfield located in the Arabian Sea, off the coast of Mumbai, Maharashtra.
Bassein Satellite: An offshore oil and gas field.
Production Sharing Contract (PSC): A contract between a government and a company for exploration and production of resources.
Hydrocarbon Exploration and Licensing Policy (HELP): A policy by the government to govern the exploration and licensing of hydrocarbons.
Vedanta Ltd.: A private sector company that participated in OALP rounds.
LOK SABHA
UNSTARRED QUESTION NO.3184
TO BE ANSWERED ON 07TH AUGUST 2025
Boosting of Domestic Crude Oil and Natural Gas Production
3184. Dr. D Ravi Kumar:
पेट(cid:332)ोिलयम और (cid:366)ाकृ ितक गैस मं(cid:361)ी
Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:
(a) the steps taken by the Government to boost domestic crude oil and natural gas production
and reduce dependency on imports in line with the 2025 energy security goals;
(b) the response of private players to bids under the Open Acreage Licensing Policy (OALP)
through the latest bid rounds including Round-VIII concluded in 2023;
(c) the current number of private oil companies engaged in exploration activities across the
country and reasons for their limited participation despite policy reforms;
(d) the current share of private companies in exploration output keeping in view that ONGC
has drilled over hundred exploratory wells in 2023-24; and
(e) the reasons for the Ministry’s proposal to offer 60% stake and operatorship in producing
fields like Mumbai High and Bassein & Satellite to international partners and its
implications on domestic control and revenue?
ANSWER
पेट(cid:332)ोिलयम और (cid:366)ाकृ ितक गैस मं(cid:361)ालय म(cid:336) रा(cid:475)मं(cid:361)ी
((cid:373)ी सुरेश गोपी)
MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS
(SHRI SURESH GOPI)
(a) Government has taken various policy decisions and steps to boost domestic crude oil and
natural gas production and reduce dependency on import of oil and gas which, inter alia, include:
i. Policy under Production Sharing Contract (PSC) regime for early monetization of
Hydrocarbon discoveries, 2014;
ii. Discovered Small Field Policy, 2015;
iii. Hydrocarbon Exploration and Licensing Policy (HELP), 2016
iv. Policy for Extension of PSCs, 2016 and 2017;
v. Policy for early monetization of Coal Bed Methane, 2017;
vi. Setting up of National Data Repository, 2017;
vii. Approval of Un-appraised areas in Sedimentary Basins under National Seismic
Programme, 2017;
viii. Policy frameworks for extension of Production Sharing Contracts (PSCs) for Discovered
Fields and Exploration Blocks under Pre-New Exploration Licensing Policy (Pre-NELP)
2016 & 2017;ix. Policy to Promote/Incentivize Enhanced Recovery Methods of Oil/Gas 2018;
x. Policy Framework for exploration and exploitation of Unconventional Hydrocarbons
under Existing Production Sharing Contracts (PSCs), Coal Bed Methane (CBM)
Contracts and Nomination Fields, 2018;
xi. Natural Gas Marketing Reforms, 2020;
xii. Lower Royalty Rates, Zero Revenue Share (till Windfall Gain) and no drilling
commitment in Phase-I in OALP Blocks under Category II and III basins to attract
bidders;
xiii. Release of about 1 Million Sq. Km. (SKM) “No-Go” area in offshore which were earlier
blocked for exploration for decades;
xiv. Amendments in the Oilfields (Regulation and Development) Act, 1948 to promote ease
of doing business, contractual stability, operational efficiency and faster dispute
resolution.
(b)& (c) In OALP-VIII and OALP-IX rounds, total four (04) private sector companies participated in
the bidding process. The details of Bids are tabulated below: -
S. Company Name(s) No. of bids submitted No. of bids submitted
No. in OALP-VIII in OALP-IX
1 Vedanta Ltd. 1 28
2 Sun Petrochemicals Private Limited 1 7
3 Reliance Industries Ltd + BP
1 1
Exploration (Alpha) Ltd.
Total 3 36
More than 15 private oil companies are engaged in exploration activities in Exploration and
Production (E&P) industry across the country. The E&P industry is capital-intensive, requiring
significant upfront investment, which can be a deterrent for new entrants and smaller players.
Further, inherent risks associated with exploration activities and fluctuating commodity prices
make securing financing challenging. Apart from this, Global oil and gas price volatility can impact
the economic viability of projects which make it difficult to predict returns on investment.
To address the issues, the Government have from time to time introduced Policy Reforms as
per the feedback received from the investors and changing dynamics of hydrocarbon industry with
the aim to enhance ease of doing business and attract private players to the E&P Sector.
(d) In 2023–24, ONGC drilled 103 exploratory wells whereas private companies collectively drilled 11
wells in the same period.
(e) No such proposal for sale of stake is currently under consideration of Government.
*****