Cabinet clears Rs 84,084 crore 'Samudra Manthan' offshore exploration scheme

The Union Cabinet on Friday approved the 'Samudra Manthan' — the National Offshore Exploration Scheme — with a total outlay of Rs 84,084 crore. The decision, announced through a government release, is aimed at intensifying oil and gas exploration in India's offshore sedimentary basins.

The scheme is expected to open up new frontiers in the country's energy hunt, tapping into vast untapped reserves beneath the sea. Government officials said the programme will cover both unexplored and under-explored offshore areas, with an emphasis on high-risk, high-reward zones.

What the scheme entails

'Samudra Manthan' is designed to accelerate exploration activities across India's exclusive economic zone. The outlay will fund seismic surveys, drilling operations, and technology deployment in deep-water and ultra-deep-water blocks.

By incentivising private participation, the scheme seeks to bring in global expertise and capital. The government hopes it will reduce the country's dependence on imported crude, which currently meets over 80 per cent of domestic demand.

Why offshore exploration matters

India's offshore basins, particularly in the Krishna-Godavari, Cauvery, and Andaman waters, hold significant hydrocarbon potential. Yet, a large portion of these areas remains unexplored due to technical challenges and high costs.

The new scheme addresses these hurdles by offering fiscal incentives and a streamlined approval process. It also aligns with the government's broader push to boost domestic production and achieve energy self-reliance.

Industry response and expectations

Industry experts have welcomed the move, calling it a long-pending step towards energising the exploration sector. The scheme is expected to attract interest from both national oil companies and foreign players looking for new reserves.

However, some analysts point out that the real test lies in execution. Exploration in deep waters involves complex logistics and environmental safeguards, which could slow progress. The government has not yet detailed the timeline for awarding blocks or the specific incentives on offer.

Broader energy context

The approval comes amid global volatility in energy prices and supply chain uncertainties. India's oil import bill has been a persistent strain on the economy, making domestic exploration a strategic priority.

With this scheme, the government is betting on technology and investment to unlock offshore riches. It also complements existing policies like the Open Acreage Licensing Programme and the Hydrocarbon Exploration and Licensing Policy.

As the scheme rolls out, stakeholders will watch for the first round of bidding and the pace of clearances. The success of 'Samudra Manthan' could well determine India's ability to reduce its energy import bill in the coming decade.