The Union Cabinet of India has approved the policy to allow firms to explore and exploit unconventional hydrocarbons, including shale oil and gas, coal bed methane (CBM) under the existing field contracts.
The move will enable contractors to unlock the potential of unconventional hydrocarbons in the existing acreages.
Under the existing oil and gas exploration policy, holders of production sharing contracts (PSCs) are forbidden from exploring and exploiting CBM or other unconventional hydrocarbons in licensed/leased areas already assigned to them.
Through the new policy, the government intends to facilitate the realisation of prospective hydrocarbon reserves, which would otherwise remain unexplored according to the existing regime.
The government intends to attract new investment in exploration and production (E&P) activities that are directed towards new hydrocarbon discoveries.
India is mainly dependent on import of oil and gas, with fuel import expenditures forming a significant part of the country’s imports bill.
The current administration is focused on reducing this dependence and the new policy is aimed at increasing domestic production.
The initiative is expected to drive the utilisation of technology in the exploitation of unconventional hydrocarbons, with potential for new technological partnerships.
Major basins holding potential for shale oil and gas discoveries are Cambay, Krishna- Godavari (KG), and Cauvery, where mature organic-rich shale exist.
The new policy marks the shift from ‘One hydrocarbon Resource Type’ to ‘Uniform Licensing Policy’, the government said in a statement.
India has probable shale gas resources between 100Tcf and 200Tcf ‘in place’ in five sedimentary basins.
