The Union government’s flagship scheme for offshore exploration aims at catalysing reserves of more than 600 million metric tonnes of oil equivalent (MMTOE). Representational image
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Seeking to provide a fillip to India’s offshore exploration, the Union Cabinet on Friday (July 31, 2026) approved an outlay of ₹84,084 crore for the Union Petroleum Ministry’s National Offshore Exploration Scheme, titled ‘Samudra Manthan’.
The corpus is to be utilised until fiscal year 2030-31. The overall outlay is categorised into four key components. The most important of these relates to drilling 60 deepwater exploration wells for which the Cabinet has allocated ₹43,200 crore.
This is inclusive of the government of up to 50% of eligible drilling cost or ₹675 crore per well.
The other component relates to offshore data acquisition which carries an outlay of ₹28,534 crore.
Development of common offshore infrastructure hubs to facilitate commercialisation of discoveries which would be accounting for an outlay of ₹10,000 crore.
Finally, the establishment of oil and gas manufacturing and services zones – seeking to promote domestic manufacturing and localisation of critical equipment and services – tabulate an outlay of ₹2,000 crore.
Overall, the Union government’s flagship scheme for offshore exploration aims at catalysing reserves of more than 600 million metric tonnes of oil equivalent (MMTOE).
It envisages to “stimulate significant investments across the exploration and production value chain, creating long-term opportunities for industry, innovation and economic growth.”
Essentially, with hydrocarbon exploration being a capital-intensive activity with long gestation period but essential for a country’s domestic energy security, the scheme seeks to reorient growth into the realm (via offshore exploration) to overcome difficulties from ageing existing oil and gas fields.
Reflecting on the announcement, Rajnish Gupta, Partner for Tax and Economic Policy at EY India held, “Investments in large-scale seismic data acquisition and drilling of exploratory well in deep and ultra deep waters will reduce geological uncertainty and derisk exploration and lay the foundation for future discoveries. Goods results can catalyse greater private investments in the sector.”
Published – July 31, 2026 09:48 pm IST
