India to pass new law on oil exploration in next parliament session, says union petroleum and natural gas minister

New Delhi: India will pass a new law in the next parliament session to facilitate investments in exploration of major offshore oil deposits located in previously blocked zones, Union petroleum and natural gas minister Hardeep Singh Puri said on Tuesday.

The new law was proposed after obtaining feedback from major oil exploration companies on how policies could be tweaked, Puri said.

"I went to the cabinet with a note, got the cabinet approval and I filed in the parliament. In the next session, which will hopefully be next month, it will be next month, I will get that bill passed and it will be enacted into law," the minister said at the Financial Times conclave in the national capital.

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The proposed new law will replace the existing Oilfields (Regulation and Development) Act of 1948, which governs operations of oilfields in the country, Puri said.

As many as 38% of all bids in the ninth round of the Open Acreage Licensing Policy (OALP), which was open from January to September, were for exploration in a previously no-go zone within the country's offshore exploration regions, Puri said. The 10th round of the biannual policy will be passed after the next parliament session.

Puri was speaking about oil exploration zones that were categorised as no-go zones by the government. Companies have shown keen interest in exploring such regions for oil.

"(The government) has cleared 1 million square km, which were earlier no-go areas. By no-go area, I mean either the Navy had a problem there or the Coast Guard had a problem or the DRDO had a problem. Everybody said we can't - this is not allowed," Puri said, adding that the government decided to open up such areas after an internal discussion.

Guyana example

Pushing for oil exploration in India's offshore projects, especially in previously no-go zones, Puri cited the case of Guyana, which hit oil after multiple failures.

"If you have a major oil find in the same ocean there, there are several Guyanas to be made," he said.

The minister said green hydrogen is the fuel of the future and a fall in the price of the clean fuel would lead to a considerable decrease in India's oil imports. The country currently imports about 80% of its crude oil requirements.

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Puri added that India was on track to achieving 20% ethanol blending by October 2025, five years in advance of the target. Ethanol blending is the process of mixing ethanol in petrol or diesel to create a fuel mixture for internal combustion engine vehicles and is key to reducing vehicular emissions.

India has an oil-refining capacity of 252 million metric tonnes per annum and plans to scale this up to about 400 million metric tonnes, the minister added.