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

Key Highlights:

• The Union Cabinet approved Samudra Manthan, the National Offshore Exploration Scheme, with an outlay of ₹84,084 crore.
• This Central Sector Scheme of the Ministry of Petroleum & Natural Gas will be implemented through FY 2030-31.
• The scheme aims to boost domestic hydrocarbon production and reduce India's energy import dependence, aligning with Atmanirbhar Bharat.
• It is India's most ambitious offshore exploration mission, focusing on deepwater and ultra-deepwater basins.
• The government will provide financial support of up to 50% for drilling deepwater exploration wells, capped at ₹675 crore per well.

Detailed Insights:

• India is the world's third-largest crude oil consumer, with an annual import bill of approximately USD 144 billion (₹13 lakh crore).
• The scheme builds upon structural reforms since 2014, including opening over 99% of India's Exclusive Economic Zone (EEZ) for exploration.
• Reforms also include transitioning from Production Sharing Contracts to Revenue Sharing Contracts and enacting the Oilfields (Regulation and Development) Amendment Act, 2025.
• Hydrocarbon exploration is capital-intensive and has a long gestation period of 5-10 years, with existing fields experiencing a 6-7% annual production decline.
• Key components include acquiring offshore seismic data (₹28,534 crore), drilling 60 deepwater exploration wells (₹43,200 crore), and developing common offshore infrastructure hubs (₹10,000 crore).
• It also involves establishing Oil and Gas Manufacturing and Services Zones (₹2,000 crore) to promote domestic manufacturing.
• Samudra Manthan aims to increase domestic oil and gas production from 62 MMTOE to 80 MMTOE annually and expand the hydrocarbon resource base from 1.6 billion TOE to 2.2 billion TOE.
• This additional production has the potential to reduce crude oil imports by nearly ₹1 lakh crore annually.

Key Concepts Involved:

• Central Sector Scheme: A scheme fully funded by the Central Government and implemented by Central Government agencies.
• Exclusive Economic Zone (EEZ): An area beyond and adjacent to the territorial sea, extending up to 200 nautical miles, where a state has special rights over exploration and use of marine resources.
• Production Sharing Contract (PSC): A contract where the government and a company share the production of oil/gas after cost recovery.
• Revenue Sharing Contract (RSC): A contract where the government receives a share of the revenue from hydrocarbon production.
• Atmanirbhar Bharat: A vision to make India a self-reliant nation across various sectors, including energy.