- 635 million metric Tones (MMT) of proven oil reserves (2P).
- 54 trillion cubic Feet of proven natural gas reserves and 96 trillion cubic Feet of estimated Shale gas reserves.
- Third largest consumer of crude oil and petroleum products in the world and second largest refiner in Asia.
- 60% of the prognosticated reserves of 28,000 MMT are yet to be harnessed
- Regasified Liquefied Natural Gas (RLNG) regasification facility is likely to increase from 47.5 MMTPA* by 2022 from a current level of 22 MMTPA.
- Exploration activities of oil and natural gas fields, infrastructure related to marketing of petroleum products and natural gas, marketing of natural gas and petroleum products, petroleum products’ pipelines, natural gas pipelines, LNG regasification infrastructure, market study, formulation and petroleum refining in private sector, subject to the existing sectoral policy and regulatory framework in the oil marketing sector and the policy of the government or private participation in exploration of oil and the discovered fields of natural oil companies – 100% FDI, automatic route.
- Petroleum refining by PSU, without disinvestment of dilution of domestic equity in existing PSUs – 49% automatic route.
- Government has approved Hydrocarbon Exploration & Licensing Policy (HELP) and same has been notified on March 30, 2016. This policy provides a uniform licensing system to explore and produce all hydrocarbons such as oil, gas, coal bed methane, shale oil/gas, etc. under a single licensing framework, option to select the exploration blocks without waiting for formal bid round and also provides many incentives such as reduced royalty rates for offshore blocks, marketing & pricing freedom and easy to administer revenue sharing model.
- Discovered Small Fields Policy announced in March, 2016 for monetization of 67 discoveries thorough international competitive bidding.
- Under the New Domestic Gas Pricing Policy, a transparent new gas pricing formula linked to global market made effective w.e.f. November 1, 2014.
- Marketing and pricing freedom for gas produced from geologically difficult, high risk / high cost areas with a provision of ceiling price based on landed cost of alternate fuels announced on March 10, 2016.
- Policy Framework for relaxation, extensions and clarifications at the development and production stage under PSC (Production haring Contract) regime for early monetization of hydrocarbon discoveries was approved on November 10, 2014.
- Policy for grant of extension to the Production Sharing Contracts of 28 Small and medium sized discovered blocks was approved on March 10, 2016.
- Policy on Testing Requirements for discoveries in New Exploration Licensing Policy (NELP) blocks was approved on April 29, 2015.
- Hydrocarbon vision 2030 for North East India has been released in February, 2016
- Pooling of gas in Fertilizer (Urea) sector was approved on March 31, 2015 for supply of gas at uniform delivered price to all fertilizer plants on the gas grid for production of urea through a pooling mechanism of domestic gas with R-LNG
- The Petroleum and Natural Gas Regulatory Board Act, 2006 regulates refining, processing, storage, transportation, distribution, marketing and the sale of petroleum, petroleum products and natural gas.
- The National Biofuel Policy, 2009 promotes bio-fuel usage, the Government of India has provided a 12.36% concession on excise duty on bio-ethanol and exempted bio-diesel from excise duty.
- Government is implementing Ethanol Blending Petrol programme under which oIL marketing companies are mandated to sell Ethanol blended petrol with upto 10 % Ethanol. Mechanism for procurement of ethanol by Oil Marketing Companies (OMCs) to carry out Ethanol Blended Petrol programme was approved on December 10, 2014. In order to give a stimulus to the above programme, the Government has enhanced the Ethanol Procurement Price and opened alternate route like cellulosic and ligno cellulosic materials, including Petrochemical route.
- Direct sale of bio-diesel by private manufacturers/suppliers to bulk consumers like Railways and State Transport Corporations was allowed on August 10th, 2015.
- The milestones set in Auto Fuel Policy 2003 have already been achieved. Ministry of Petroleum and Natural Gas has issued a communication to all the concerned stake holders including Oil Marketing Companies for implementation and expansion of Supply of BS-IV auto fuels in phases covering the entire country by April 1, 2017 as per the road map given in Auto Fuel Vision & Policy -2025
- The Government has decided to leapfrog from BS-VI to BS — VI fuels w.e.f. April 1, 2020.
- The Policy on Shale Gas & Oil, 2013 allows companies to apply for shale gas and oil rights in their petroleum exploration licenses and petroleum mining leases.
- The rate of cess on crude oil production has been revised to 20% advalorem basis from USD 69.23 per metric tonne
- Various exemptions from customs duty on goods imported for petroleum exploration licenses and movement of goods from one block to another under various types of licenses/mining leases etc., have been merged into a single exemption, with unified list of goods and conditions
- To facilitate smooth trade of natural gas across India thereby helping to build a gas-based economy, the central sales tax rules regarding inter-state transport of natural gas through common carrier pipeline have been amended.
- Keeping in view the bulky nature of oil & gas investments, an enhanced window has been made available to avail the benefit of additional depreciation of 15% on installation of capital equipment acquired in the previous year to be made before 31.03.17.
- To increase investment in exploration sector, No Basic Customs Duty & Countervailing Duty (CVD) on imports of goods required for exploration & production of hydrocarbon activities is also extended to operations undertaken to Exploration Licenses & Mining Leases issued or renewed before 1st April 1999.
- Apart from the above, each state in India offers additional incentives for industrial projects. Incentives are provided in areas such as subsidised land cost, the relaxation of stamp duty on sale/lease of land, power tariff incentives, concessional rates of interest on loans, investment subsidies and/or tax incentives, backward areas subsidies, special incentive packages for mega projects.
Area based Incentives:
- Hydrocarbon Vision 2030 for North East India has been released. It envisages an investment of USD 20 Billion in upstream, downstream and midstream sector in Hydrocarbon Sector in North East India till 2030. To incentivize E&P (Exploration & Production) in the North East, 40 % subsidy on gas operation has been extended to private companies operating in the region.