India's New Oil Field Amendment Bill 2024: A Game Changer for Small Oil Fields

The Oil Field Amendment Bill 2024 introduces investor-friendly terms for Discovered Small Fields (DSF) in India. It allows 100% foreign participation, continuous exploration, and liberalized pricing, attracting substantial investment and enhancing domestic hydrocarbon production.

The Indian government has unveiled the Oil Field Amendment Bill 2024, a legislative move aimed at transforming the landscape for small oil fields. By relaxing regulations, the bill promises to boost investor interest in Discovered Small Fields (DSF) through incentives such as 100% foreign participation, enhanced exploration flexibility, and improved financial agreements.

These reforms are expected to draw both domestic and international investments, injecting much-needed capital and technology into India's oil and gas industry. One major highlight includes the removal of the upfront signature bonus, a change that aims to lower entry barriers for new investors and make the sector more accessible and competitive.

Another significant amendment allows companies to continuously explore throughout the contract period, a shift set to maximize resource extraction and potentially lead to new hydrocarbon discoveries. Aligning royalty rates with the Hydrocarbon Exploration and Licensing Policy (HELP) and removing production-related cess further decreases operational costs, bolstering investor confidence.

Since the policy's implementation, India's hydrocarbon resources under the DSF have reached approximately 162 million metric tonnes of oil equivalent, with investments estimated at around USD 2.9 billion. The active participation of 29 new market players and 56 ongoing contracts underlines a robust increase in production levels. Cumulative oil and gas output figures, recorded at 0.107 MMT and 0.214 BCM respectively as of February 2025, highlight India's rising prominence in the global energy market.

The Oil Field Amendment Bill 2024 is poised to accelerate domestic energy production, reduce India's reliance on imports, and secure the country's energy future by attracting significant foreign and domestic investment, thus strengthening production efficiency and energy security.

(With inputs from agencies.)