Indian Cabinet approves ₹84,084 crore 'Samudra Manthan' offshore exploration scheme

New Delhi: The Indian Union Cabinet, chaired by Indian Prime Minister Narendra Modi, on Friday approved 'Samudra Manthan', the National Offshore Exploration Scheme, a Central Sector Scheme of the Indian Ministry of Petroleum and Natural Gas, with an outlay of ₹84,084 crore for implementation until 31 March 2031.

According to a statement issued by the ministry, India is the world's third-largest consumer of crude oil, with an annual import bill of nearly $144 billion (around ₹13 lakh crore). The Indian government said recent geopolitical developments have highlighted the strategic importance of ensuring secure and uninterrupted access to energy resources for a rapidly growing economy.

Since 2014, the Indian government has introduced a series of structural reforms to create an enabling ecosystem for hydrocarbon exploration and production.

According to the ministry, more than 99 per cent of the earlier "no-go" areas have been opened, making over one million square kilometres of India's Exclusive Economic Zone available for exploration for the first time.

India also transitioned from Production Sharing Contracts to Revenue Sharing Contracts, simplifying the fiscal framework, improving transparency and reducing administrative intervention.

The Oilfields (Regulation and Development) Amendment Act, 2025 modernised the legal framework governing the sector by providing contractual stability, recognising integrated petroleum operations, strengthening dispute resolution mechanisms and establishing a modern regulatory framework.

The Petroleum and Natural Gas Rules, 2025 operationalised these reforms by promoting ease of doing business, improving regulatory efficiency and streamlining the administration of petroleum leases.

The Indian government also standardised the composition and mandate of the Empowered Committee of Secretaries across all contract regimes to ensure consistency and provide a level playing field for operators, regardless of when their contracts were signed, the ministry said.

It added that the performance parameters of ONGC and Oil India have been revised to place greater emphasis on exploration activities, reinforcing the Indian government's commitment to expanding the country's domestic hydrocarbon resource base.

According to the ministry, the National Offshore Exploration Scheme – Samudra Manthan marks the transition from policy reforms to mission-mode implementation.

The scheme comprises four key components:

• Acquisition and processing of modern offshore seismic data with an outlay of ₹28,534 crore.
• Drilling of 60 deepwater exploration wells with an allocation of ₹43,200 crore, including Indian government support of up to 50 per cent of eligible drilling costs or ₹675 crore per well, whichever is lower.
• Development of common offshore infrastructure hubs with an outlay of ₹10,000 crore to facilitate the commercialisation of discoveries.
• Establishment of Oil and Gas Manufacturing and Services Zones with an outlay of ₹2,000 crore to promote domestic manufacturing and localisation of critical equipment and services.

Subject to successful exploration, the scheme aims to increase India's domestic oil and gas production from around 62 million metric tonnes of oil equivalent (MMTOE) to 80 MMTOE annually. It also seeks to expand the country's hydrocarbon resource base from 1.6 billion tonnes of oil equivalent (TOE) to 2.2 billion TOE.

According to the ministry, the additional production has the potential to reduce India's crude oil import bill by nearly ₹1 lakh crore annually, strengthening the country's energy security and reducing import dependence.