Exploration Dynamics under the Changed Regulatory Regime in India
Devashish Chakravarty and Sasidharan Kinattukara
ONGC, Dehradun, India
The upstream oil industry developed over many hundreds of years in different ways across the continents. With the passage of time and with oil gaining a strategic importance, governments stepped in either to explore themselves or to issue ‘licenses’ for exploring oil. The oldest known history of petroleum licensing perhaps goes back to 1840s in Russian Azerbaijan at Baku, where an oil trade with a structured system of licensing existed.
Though the history of oil exploration in India dates back to 1866, the Pre-Independence era saw efforts concentrated only in the northeast of the country by foreign companies. Post-Independence, the NOCs emerged and exploration spread across the country. Upto the beginning of 1990’s, about 17 per cent of the entire sedimentary area covering about 0.52 million sq km was brought under the oil and gas map with commercial production. Post 1990, Government of India initiated the process of deregulating and delicensing the petroleum sector which culminated in a New Exploration Licensing Policy (NELP) in 1999. NELP was brought to provide exploration thrust to hitherto less-explored basins, induction of the latest E&P technology and generation of new ideas with more players in fray. Almost simultaneously end of nomination era for NOCs was signaled.
With these twin changes in the regulatory regime, the industry witnessed a paradigm shift. With NOCs reprioritising their objectives, there was entry of private players, increase in data acquisition and investments, and some significant discoveries. This paper attempts to make a threadbare analysis of exploration spread in sectors viz., producing, yet-to-produce, frontier onland, fold-belt and deep water in terms of the desired objectives of the regulatory policy changes and suggets future strategies.
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