New Delhi: The Joint Working Group (JWG) formed to address critical bottlenecks that affect the ease of doing business in India’s oil and gas exploration and production (E&P) sector has proposed broadening its scope to involve representatives from state governments and other relevant Union ministries in a formal mechanism, a Joint Standing Committee, to streamline statutory approvals. The JWG has said that addressing several challenges facing the companies operating in the E&P sector require coordinated efforts across multiple ministries and state governments for effective resolution.
“Key among these challenges are the streamlining of statutory approvals, such as forest clearance (FC) and environmental clearance (EC), as well as tax incentives to stimulate upstream investment. As these issues fall under the jurisdiction of multiple regulatory authorities, their resolution requires a structured and collaborative approach across government agencies. To address this, JWG has proposed broadening its scope to involve representatives from state governments and other relevant ministries in a formal mechanism to address these issues and further advance efforts for Ease of Doing Business,” the group said in its report. The JWG currently consists of Secretaries from the Petroleum Ministry and representatives from oil and gas companies and the Directorate General of Hydrocarbons (DGH) and it has prepared a report which includes recommendations for enhancing ease of doing business in the E&P sector. The report was unveiled by Petroleum Minister Hardeep Singh Puri on April 15 in New Delhi.
“The establishment of the proposed Joint Standing Committee will be instrumental in fostering ongoing dialogue, accelerating decision-making, and creating an investmentfriendly environment for upstream activities. Collectively, these reforms will enhance India’s attractiveness as a destination for upstream investment, support the sustainable development of domestic hydrocarbon resources, and contribute meaningfully to the nation’s overarching objective of energy security and self-reliance,” says the group in its report.
The group has identified 18 issues out of 83 listed by industry stakeholders that fall within the purview of the Petroleum Ministry. The JWG has divided these 18 issues under two categories on the basis of the timelines within which they can be addressed — 6 months and one year. “Among the issues reviewed, 18 critical issues have been prioritised as resolvable in the immediate and short-term period. This part also includes specific actionable recommendations to address these issues expeditiously,” the report says.
The issues that the JWG has recommended be resolved expeditiously within the next six months include, approval for delivery points within and outside the contract area, grant of excusable delays/ extra days for delays in government-related approvals, reduction in contract area and work programme, due to denial or delay in statutory clearances for exploratory activities, review of bank guarantee requirements which cover the entire work programme, including portions that have been completed, Field Development Plan (FDP) approvals of PSC blocks, grant of extension in exploration/development period across contractual regimes, process for PSC extension applications and approvals, provisions for incentives on sale of natural gas to private operators in Northeast region, transfer of Participating Interest (PI) among existing PI holders under a contract and Annual Work Programme (AWP) and Budget approval under CBM regime.
The other category of issues which the JWG has proposed be resolved within a year’s timeframe include, flexibility to deploy new exploration technology/ methods for meeting Minimum, Committed or Bid Work Programme, flexibility to swap exploration activities across contracts within the same or higher category basin, Field Handover process in DSF contracts, exchange rate conversion methodology across contract regimes, Open-Source National Data Repository (NDR) and collaborative resource-sharing among operators in E&P sector.
The report says that India’s oil production is expected to increase over the short term, reaching 45.5 MMT by FY 2029-30, projections indicate a subsequent decline, with output anticipated to fall to 27.2 MMT by FY 2034-35. “This trend reflects the growing challenges of maturing oil fields and the limited scope of recent discoveries in onshore and shallow water basins,” it says.
The report also says that India’s natural gas production, which currently stands at 36.58 BCM is expected to rise to 54.7 BCM by FY 2029-30, and further increase to 63.7 BCM by FY 2034-35. “Driven by strategic policy initiatives, technological advancements, and new discoveries, the natural gas sector is positioned for considerable growth in the coming years… This growth trajectory aligns with the government’s objective of increasing the share of natural gas in the primary energy mix from 6 percent to 15 percent by 2030, reinforcing India’s commitment to cleaner energy sources and reduced carbon emissions,” the JWG report says.
