India announces a substantial state-backed investment to boost deep-sea oil and gas exploration across its exclusive economic zone, aiming to reduce reliance on imports and attract global operators amid geopolitical tensions.
India is preparing a 840 billion rupee, or about $8.8 billion, state-backed push to open up deep-sea oil and gas exploration, in a bid to reduce its heavy reliance on imported energy and draw in global operators that have so far stayed cautious. According to the Vietnamese news agency VietnamPlus, the scheme is designed to soften the financial risks of drilling in deep waters and make projects more attractive to private capital.
Under the plan, the government would cover as much as 6.75 billion rupees, or half the drilling cost of each deep-water well, whichever is lower. The programme would apply across the Bay of Bengal, the Arabian Sea and the Andaman Sea, while India’s exclusive economic zone, which had previously been constrained by defence concerns, would be opened to large-scale drilling.
Reuters has reported that the Cabinet, led by Prime Minister Narendra Modi, has already approved the National Offshore Exploration Project, branded Samudra Manthan, and described it as India’s most ambitious offshore exploration drive yet. The initiative comes as New Delhi looks to lift domestic oil and gas output after years of stagnation at ageing fields and slow new exploration.
The timing is also shaped by energy-security concerns. India imports roughly 90% of the crude it consumes and about half of its natural gas, with Russia and Middle Eastern suppliers among the main sources, according to the VietnamPlus report. Recent tensions involving the US and Iran have also underlined the vulnerability of global oil flows and helped keep pressure on prices.
Officials hope the programme will expand India’s hydrocarbon resource base from 1.6 billion tonnes of oil equivalent to 2.2 billion tonnes, while also creating jobs and spurring investment across the wider exploration and production chain. The Economic Times has separately reported that India is also auctioning 18 deep-water and ultra-deep-water blocks, suggesting New Delhi is trying to pair subsidies with access to fresh acreage to tempt companies from Europe, the US and Japan.
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