Government Launches Initiatives to Cut Crude Oil Imports, Boost Hydrocarbon Production

The government has taken various steps to reduce import of crude oil. These inter alia include demand substitution by promoting usage of natural gas as fuel/feedstock across the country towards increasing the share of natural gas in economy and moving towards gas based economy, promotion of renewable and alternate fuels like ethanol, second generation ethanol, compressed bio gas and biodiesel, refinery process improvements, promoting energy efficiency and conservation, efforts for increasing production of oil and natural gas through various policies initiatives, etc. To give a major thrust to Ethanol Blending Programme, Government of India through Oil Marketing Companies (OMCs) is establishing 2G Ethanol plants across the country. Also, for promoting the use of Compressed Bio Gas (CBG) as automotive fuel, Sustainable Alternative Towards Affordable Transportation (SATAT) initiative has been launched.

The government has been taking various steps to increase hydrocarbon production which inter-alia include:

i. Policy for Relaxations, Extensions and Clarifications 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 Production Sharing Contracts, 2016 and 2017.

v. Policy for early monetization of Coal Bed Methane 2017

vi. Setting up of National Data Repository, 2017. Further, the National Data Repository (NDR) is now being further upgraded to a cloud-based system for seamless dissemination of Exploration & Production data to global investors.

vii. Appraisal of Un-appraised areas in Sedimentary Basins under National Seismic Programme, 2017;

viii. Re-assessment of Hydrocarbon Resources, 2017.

ix. Policy framework to streamline the working of Production Sharing Contracts in Pre- NELP and NELP Blocks, 2018.

x. Policy framework for extension of Production Sharing Contracts for Discovered Fields and Exploration Blocks under Pre-New Exploration Licensing Policy (Pre-NELP), 2016 and 2017.

xi. Policy to Promote and Incentivize Enhanced Recovery Methods for Oil and Gas, 2018.

xii. Policy framework for exploration and exploitation of Coal Bed Methane (CBM) from areas under Coal Mining Lease allotted to Coal India Limited (CIL) and its subsidiaries, 2018.

xiii. Policy Framework for exploration and exploitation of Unconventional Hydrocarbons under Existing Production Sharing Contracts (PSCs), Coal Bed Methane (CBM) Contracts sand Nomination Fields, 2018.

xiv. Reforms in Hydrocarbon Exploration and Licensing Policy for enhancing domestic exploration and production of oil and gas, 2019.

xv. Natural Gas Marketing Reforms, 2020.

xvi. Reforms in Model Revenue Sharing Contracts (RSCs) for Blocks under Open Acreage Licensing Programme (OALP), 2023.

xvii. Lower Royalty Rates, Zero Revenue Share (till Windfall Gain) and no drilling commitment in Phase-I in OALP Blocks under Category II and III to attract bidders.

xviii. Release of about 1 million Sq. Km. ‘No-Go’ area in offshore which were blocked for exploration for decades. In this erstwhile ‘No-Go’ area, after the release now, so far bids/ expression of interests received for 1,52,325 Sq. Km. area. Two gas discoveries have also been made by ONGC in Mahanadi offshore recently in a block having 94% area in ‘No-Go’ area. Andaman offshore area has also been opened for exploration and production activities after a long-time post removal of restrictions imposed by defence and space agencies in 2022.

xix. Till now, 12 hydrocarbon discoveries have been made in blocks awarded under OALP, one already producing gas (0.44 MMSCMD) and condensate (819 BBL/Day) in Gujarat while other discoveries are under appraisal.

xx. Government is spending about Rs.7500 Cr. for acquisition of seismic data in onland and offshore areas and drilling of stratigraphic wells to make quality data of Indian Sedimentary Basins available to bidders.

xxi. Government has also approved acquisition of additional 2D Seismic data of 20,000 LKM in onland and 30, 000 LKM in offshore beyond Exclusive Economic Zone (EEZ) of India.

xxii. Production of Coal Bed Methane (CBM) has reached 2 million Standard Cubic Meters per day and will increase further in coming years. More blocks are being identified for offer in future bid rounds.

xxiii. Cumulative production from Discovered Small Fields (DSF) till FY 2023-24 are ~5,56,000 bbl Oil and ~139 MMSCM Gas. More fields are being planned for offer in future rounds.