New Delhi: The Rajya Sabha on Tuesday passed a bill that seeks to amend existing law governing the exploration and production of oil and gas, and delink petroleum operations from mining operations to boost investment in the sector.
The Oilfields (Regulation and Development) Amendment Bill, 2024, introduced in the Rajya Sabha in August this year, was passed by a voice vote. Replying to the debate on the bill, Oil Minister Hardeep Singh Puri said that the oil and gas sector involves high investment and a long gestation period.
"We need the oil and gas sector 20 more years. We need to bring this legislation here to provide a win-win confidence not only to our operators but also to foreign investors so that they can come and do business here to benefit everyone," Puri said. He said policy stability, dispute resolution and sharing of infrastructure, especially for small players are new provisions in the bill.
He also explained the point of helium raised by members, saying that mineral oils are naturally occurring hydrocarbons and thus helium is not a hydrocarbon. Several opposition members also suggested that the bill be sent to a standing committee for further scrutiny.
Puri further said: "We want to ensure that investors will have more confidence to come here unlike the dull period between 2006 and 2014. There will be one lease and one licence. If there is a dispute then for dispute management there will be predictability and stability." The bill "aims to ensure policy stability for oil and gas producers and allow international arbitration and extend lease period" over areas for producing fossil fuels, he said.
It aims to decriminalise some of the provisions of the original 1948 law by introducing "penalties, adjudication by an adjudicating authority and appeal as against the order of adjudicating authority".
The bill proposes to introduce a 'petroleum lease' and expands the definition of mineral oils to include crude oil, natural gas, petroleum, condensate, coal bed methane, oil shale, shale gas, shale oil, tight gas, and tight oil and gas hydrate. This is intending to raise domestic output and cut reliance on imports. India imports more than 85 per cent of its crude oil needs and about half of its natural gas requirement.
