Our Bureau
New Delhi
In a major bid to strengthen India’s energy security and reduce its dependence on imported crude oil, the Centre has approved ₹84,084 crore incentive package to encourage deepwater and ultra-deepwater oil and gas exploration. Under the proposed scheme, the government will reimburse up to 50 per cent of the cost of drilling exploratory wells, with financial support of as much as ₹650 crore for each of the nearly 60 deepwater wells planned over the coming years.
The move comes as India continues to rely heavily on crude oil imports to meet domestic demand. Deepwater exploration has remained limited due to the enormous financial risks involved, with a single exploratory well costing between ₹1,000 crore and ₹1,200 crore, while ultra-deepwater wells can cost even more. By sharing the drilling costs, the government hopes to make exploration commercially viable and attract global energy companies with advanced offshore expertise.
The initiative forms part of a broader strategy to unlock India’s untapped offshore hydrocarbon reserves. Alongside the incentive package, the government has put 18 deepwater and ultra-deepwater blocks on offer under the Open Acreage Licensing Programme (OALP), with bids scheduled to close in September. State-run energy major ONGC has also begun drilling under its Samudra Manthan programme, marking a renewed focus on offshore exploration.
Industry experts believe the policy could significantly improve India’s long-term energy resilience by boosting domestic production, reducing import bills and encouraging technology transfer through foreign participation. However, they note that commercial discoveries may still take several years, making the initiative a long-term investment in the country’s energy future rather than an immediate solution to rising fuel demand.