Page 55 - Policy Economic Report -August 2026

POLICY AND ECONOMIC
OIL & GAS MARKET

Key Policy developments/Significant news in Energy sector

1. Cabinet approves 'Samudra Manthan' - National Offshore Exploration Scheme with an outlay of
?84,084 crore

The Union Cabinet, chaired by Hon’ble Prime Minister Shri Narendra Modi, approved “Samudra
Manthan” the National Offshore Exploration Scheme, a Central Sector Scheme of the Ministry of
Petroleum & Natural Gas carrying an approved outlay of ?84,084 crore for implementation through
FY 2030–31. It is India’s most ambitious offshore exploration mission to date.

This approval marks the culmination of a series of transformative reforms undertaken under the
leadership of the Hon'ble Prime Minister to strengthen India's hydrocarbon exploration and
production sector.

The National Offshore Exploration Scheme, Samudra Manthan, builds upon these reforms by
translating policy into action and opening a new chapter in India's journey towards energy security
and Atmanirbhar Bharat.

India is the world's third-largest consumer of crude oil, with an annual import bill of nearly USD 144
billion (approximately ?13 lakh crore). As recent geopolitical developments have demonstrated,
secure and uninterrupted access to energy resources is of strategic importance for a rapidly growing
economy.

With India's energy demand expected to rise steadily in the coming decades, enhancing domestic oil
and gas production is essential for reducing import dependence, strengthening energy resilience, and
securing the nation's long-term economic growth.

Since 2014, the Government has undertaken a series of structural reforms over the past few years to
create an enabling ecosystem for hydrocarbon exploration and production:

1. Opening Up Offshore Acreage: More than 99% of the earlier "No-Go" areas have been
removed, making over one million square kilometres of India's Exclusive Economic Zone
available for exploration for the first time.

2. Modernising the Contractual Regime: India transitioned from Production Sharing Contracts
to Revenue Sharing Contracts, simplifying the fiscal framework and improving transparency
while reducing administrative intervention.

3. Legislative Reforms: The Oilfields (Regulation and Development) Amendment Act, 2025
modernised the legal framework governing the sector by providing contractual stability,

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