Steady Progress: Key developments in the oil and gas sector

The Indian oil and gas sector has made significant progress across key segments, including pipelines, oil and gas discovery and city gas distribution (CGD). Efforts are also being made to promote compressed biogas (CBG) adoption, enabling the sector’s transition to greener alternatives.

A look at some of the key developments in the oil and gas sector over the past year…

Key policy and regulatory reforms

• Under Union Budget 2025-26, around Rs 193.27 billion has been allocated to the Ministry of Petroleum and Natural Gas (MoPNG). Of the total allocation, around Rs 0.66 billion has been earmarked for the centre’s establishment expenditure, Rs 58.76 billion for strategic oil reserves, Rs 1.17 billion for refinery and conservation (in addition to Rs 0.25 billion for the Numaligarh refinery expansion), Rs 121 billion for liquefied petroleum gas (LPG) subsidy, and Rs 7 billion for the programme component of Indradhanush Gas Grid Limited.
• The Oilfield (Regulatory and Development) Amendment Bill, 2024, passed by the Lok Sabha in March 2025, seeks to modernise the legal framework to reflect contemp­orary market needs.
• The Rajasthan government has approved the Rajasthan CGD Policy, 2025 to strengthen clean energy infrastructure across the state.

DSF auction update

• In April 2025, the MoPNG launched the fourth round of the discovered small field (DSF) auction, along with the Special Coal Bed Methane Bid Round-2025.
• The ministry awarded contracts for 28 oil and gas blocks under the ninth round of the Open Acreage Licensing Policy (OALP) and two blocks under a special round of the DSF auction.
• In February 2025, the 10th round of the OALP was launched, offering 25 blocks across 13 sedimentary basins, covering a total area of 191,986.21 square km.

Developments in the upstream segment

• Oil and Natural Gas Corporation Limited (ONGC), BP Exploration (Alpha) Limited and Reliance Industries Limited (RIL) signed a joint operating agreement for offshore exploration at the GS-OSHP-2022/2 Block, located in the Saura­shtra basin, Gujarat.
• ONGC made four oil reserve discoveries in the Asokenagar-2, Kankpul-1, Bhurkunda-1 and Ranaghat-2 wells of the WB-ONN-2005/4 block in West Bengal.
• In May 2025, Oil India Limited (OIL) commenced exploration and production activities with the initial drilling of the Debta­mura 1 well in the AA/ONDSF/Tulamara/2018 block, located in South Tripura and Gomati districts, Tripura.
• OIL also commenced gas production from the Bakhritibba DSF block. It has drilled three multi-well pads for the supply of 67,200 standard cubic metres per day (scmd) of gas and is likely to increase production to 100 million scmd.
• Hindustan Oil Exploration Company Limited completed drilling of the KSG-71 well at the Kharsang oilfield in Arunachal Pradesh.

Key projects in the pipeline

• The Durgapur-Kolkata section, which spans about 132 km and is a key part of the Jagdishpur-Haldia-Bokaro-­Dhamra pipeline project, was inaugurated in July 2025 and began commercial operations. In addition, GAIL (India) Limited commenced commercial operations of 3,119 km of pipeline, including the Phulpur-Dobhi-Bokaro-­Durgapur section, the Bokaro-Angul-­Dhamra section and the Dobhi-Barauni-­Guwahati section, covering 96.6 per cent of the total pipeline.
• Hindustan Petroleum Corporation Limited    commissioned the Chhara li­quefied natural gas (LNG) terminal.
• The development of the Mangalore LPG cavern was completed.
• Indraprastha Gas Limited inaugurated the 21 km steel pipeline network from Fatehpur to National Highway (NH)-19 and NH-335 in Kanpur, Uttar Pradesh. It also inaug­urated its online compressed natural gas station at Shamli.
• Shell, RIL and ONGC completed the country’s first offshore facilities decommissioning project, involving the removal of five wellhead platforms and associated infield pipelines, and the safe plugging and abandonment of 38 wells from the Tapti gas fields in the Arabian Sea.
• Bharat Petroleum Corporation Limited (BPCL) commissioned the Bina Refinery Green Hydrogen Project in Madhya Pradesh.
• The Petroleum and Natural Gas Regulatory Board approved the capacity augmentation of the Dahej-Uran-Dabhol-Panvel natural gas pipeline.
• Foundation stones were laid for the Visakh-Raipur multi-product pipeline, the Barauni bitumen production unit, and the Bankura and Purulia CGD projects.

CBG-CGD synchronisation scheme

• BPCL signed a tripartite agreement with the Bilaspur Municipal Corporation and the Chhattisgarh Biofuel Development Authority for the development of a CBG plant in Bilaspur, Chhattisgarh, under the CBG-CGD synchronisation scheme.
• GAIL (India), Gujarat Gas and Baba Deep Singh Green Power signed another tripartite agreement for CBG blending in the CGD network under the scheme. The plant will be set up in Qadin village, Gurdaspur, Punjab.
• IRM Energy Limited signed a tripartite agreement with IAV Biogas and GAIL (India) for CBG blending in its CGD network in Namakkal and Tiruchirappalli districts, Tamil Nadu.