Context
- Recently, the State-owned explorer-producer Oil India Ltd. (OIL) has successfully confirmed the presence of natural gas in the Andaman shallow offshore block.
Key Highlights
- Location of Discovery: The natural gas was discovered in the Andaman shallow offshore block.
- Specific Well Name: The discovery was confirmed in the third exploratory well drilled in this block, named Vijayapuram-3.
- Geologically, the AN basin lies at the intersection of the Andaman and Nicobar Basins, part of the Bengal-Arakan sedimentary system
Strategic Importance for India
- Energy Security:
- India remains heavily dependent on imported hydrocarbons, with crude oil import dependence reaching about 88% in FY 2024–25, while nearly 50% of its natural gas requirements are met through imports.
- Major suppliers of Liquefied Natural Gas (LNG) include Qatar, the United States, and the United Arab Emirates (UAE).
- Gas Based Economy: The discovery aligns with India’s vision of establishing a Gas Based Economy by 2030 and increasing share of natural gas in its primary energy basket to 15 percent by 2030.
Initiatives for Natural Gas Exploration
- Open Acreage Licensing Policy (OALP):
- It is a key component of the Hydrocarbon Exploration and Licensing Policy (HELP). Under HELP, exploration is governed by a revenue-sharing model, replacing the profit-sharing system of the earlier New Exploration Licensing Policy (NELP).
- HELP also provides a single license for exploration and production of all hydrocarbons, including both conventional and unconventional resources.
- National Deep Water Exploration Mission: Deepwater Exploration Mission is a flagship energy security initiative of the Ministry of Petroleum and Natural Gas aimed at exploring untapped oil and natural gas reserves beneath India’s seabed to enhance domestic hydrocarbon production and reduce import dependence.
- FDI Policy: 100% FDI allowed in the natural gas sector under automatic route.
With reference to the Open Acreage Licensing Policy (OALP), consider the following statements:
1. It is a component of the Hydrocarbon Exploration and Licensing Policy (HELP).
2. Companies can identify and propose exploration blocks on their own.
3. It follows a profit-sharing model.
Which of the statements given above are correct?
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Answer: A
Explanation:
• Statement 1: Correct. OALP is a key component of the Hydrocarbon Exploration and Licensing Policy (HELP).
• Statement 2: Correct. Under OALP, companies can examine available data and identify/propose exploration blocks on their own, without waiting for government-designated blocks.
• Statement 3: Incorrect. OALP operates under HELP, which follows a revenue-sharing model, not a profit-sharing model. The profit-sharing model was a feature of the earlier New Exploration Licensing Policy (NELP).
