New Delhi: In a concerted effort to boost energy self-sufficiency and attract global investments, Petroleum Secretary Pankaj Jain recently underlined a strategic overhaul in India’s approach to oil and gas exploration. Speaking on the sidelines of a high-level industry engagement, Jain underscored the shift from traditional heavy investment models to a more phased, flexible approach aimed at luring international oil majors.
The government’s Open Acreage Licensing Policy (OALP) and the Global Seismic Mapping (GSM) initiative are at the forefront of this new strategy. Jain explained that rather than requiring companies to commit large capital investments at the outset, the revised model allows firms to begin by offering technical services—such as seismic surveys or rejuvenation of mature oilfields like Mumbai High—for which they would be fairly compensated. This, he said, provides potential investors with an opportunity to “test the waters” before fully committing to larger projects.
Jain acknowledged that international oil and gas companies are already evaluating prospects in India, and noted that once they secure a foothold in a project, they tend to deepen their involvement. He cited improved legislation, policy clarity, and the country’s robust economic growth as key enablers for this increased interest.
He also addressed a lingering perception challenge—that India lacks the conditions for high-quality energy exploration compared to regions like the Gulf of Mexico. Challenging that notion, he emphasized India’s growing technical capabilities and data-driven approach. Jain expressed optimism for the upcoming 10th round of OALP, noting that collaborative ventures based on shared interests are on the rise.
Echoing the momentum, Union Petroleum and Natural Gas Minister Hardeep Singh Puri further acknowledged that while India has made progress in reducing its import dependence, more could have been achieved if key steps had been taken earlier. He admitted that domestic exploration efforts have often been inadequate, partly due to financial constraints and the high capital expenditure required for offshore drilling, which affects project profitability.
However, Puri pointed to a changing mindset both within the government and across industry. Focused efforts are now being directed at quicker-yielding assets such as Discovered Small Fields (DSF) and Coal Bed Methane (CBM), which offer faster returns compared to conventional deep-sea exploration. He also revealed that the hydrocarbon resource assessment—last conducted in 2015-16—is being updated, alongside revisions to operational practices under the Good International Petroleum Industry Practices (GPIP) framework. The Minister clarified that recent legislation supporting these initiatives was the product of extensive stakeholder consultations, drawing from international best practices. Stressing that the policy framework is not static, Puri said that draft rules for implementation have been made public with a 30-45 day window for feedback. “Legislation only works when it is implemented well,” he stated, welcoming continued input from industry players and the media.
On the subject of joint ventures, particularly with Russia, officials reiterated that exploration and production (E&P) is inherently a long-term endeavor. Both nations have made sizable investments—estimated at $13 billion from one side and $16 billion from the other. Indian companies are engaged in producing and pre-production assets in Russia, while Russian firms, including Nayara Energy, have expanded their footprint in India.
Despite geopolitical tensions impacting broader cooperation, the crude oil trade between India and Russia remains robust. From sourcing less than 0.2 per cent of its crude from Russia in February 2022, India now imports over 30 per cent, with expectations to cross 35 per cent—all via competitive tenders. Officials noted that while the trajectory of future investments remains uncertain, the synergy between Russia’s vast energy reserves and India’s high dependency on imported crude (over 85 per cent) and LNG (over 50 per cent) presents significant room for deeper collaboration.
As India continues to position itself as a global energy hub, these policy shifts and partnerships are expected to play a vital role in shaping the country’s energy future.