Petroleum, External Affairs Ministries should work closely to further spur diversification efforts, suggest Parliamentary Committee

The Ministry of Petroleum and Natural Gas (MoPNG) should enactment intimately with the Ministry of External Affairs (MEA), and different acrophobic authorities agencies, to fortify diplomatic engagement with oil-producing countries, unafraid favourable concern presumption and code taxation and regulatory hurdles faced by public-sector enterprises (PSEs) abroad, the parliamentary committee connected nationalist undertakings (2025-26) stated successful their latest study tabled Wednesday.

Stressing connected the request for diversification of crude lipid sources, the committee observed notwithstanding proactive efforts being made successful this regard, challenges persist owed to sanctions, fiscal marketplace volatility, and regulatory changes successful big countries wherever overseas projects are located. “These issues not lone impact India’s vigor import measure but besides impede the quality of CPSUs to unafraid overseas exploration and accumulation assets, thereby limiting semipermanent vigor security,” it noted.

According to the committee headed by subordinate of parliament from Kendrapara (Odisha) Baijayant Panda, India imports for astir 89% of its home crude lipid requirements. In this context, it observed, “Recent planetary events, including the Russia-Ukraine struggle and tensions successful the Middle East, person underscored the vulnerability of India’s vigor proviso concatenation and its dependence connected planetary commercialized flows.”

To this effect, it recommended intensifying efforts towards diversification of sources some “geographically and contractually”, hazard absorption practices arsenic hedging and flexible word contracts and enhancing alternate import routes, among different suggestions.

‘Optimising capex investments and enhancing efficiency’

Additionally, the committee successful their reappraisal besides recommended that superior expenditure (capex) allocations indispensable beryllium intimately linked to “measurable accumulation enhancement outcomes”. This could beryllium attained by means of accelerated improvement of recently discovered fields, wider adoption of heighten lipid betterment (EOR) techniques and efficiently maintaining existing assets.

The committee observed capex expenditures by state-owned petroleum and earthy state companies, accrued from much than ₹1.33 lakh crore (2020-21) to astir ₹1.70 lakh crore projected for 2024-25. Although, crude lipid accumulation declined from 34.2 cardinal metric tons (MMT) successful 2018-19 to a projected 28.7 MMT projected for 2024-25. Natural state output has shown “modest growth” during the aforesaid period.

Addressing ageing fields

The committee besides observed that a “significant portion” of home lipid accumulation is derived from ageing fields which person entered “natural diminution signifier contempt dense investments”. The committee, whilst acknowledging efforts of state-owned upstream large (Oil India and ONGC) to assistance production, sought they further expedite tract improvement activities and prioritise exploration successful frontier basins, among different things.

“The committee emphasise that with sustained investments, systematic reservoir management, and planetary exertion tie-ups, India’s upstream lipid and state assemblage should purpose to reverse declining trends and summation home accumulation successful the mean to agelong term,” it noted.