‘Better late than never’ — Industry reacts to Oilfields Act amendments


In a long-awaited move to address industry concerns, Parliament on March 12 approved amendments to the Oilfields (Regulation and Development) Act, 1948. The changes provide greater stability for oil and gas explorers, ensuring that any disadvantage caused by new levies will be adjusted against royalty payments.

The bill also aims to modernise the sector’s legal framework and make India’s energy sector more attractive to investors.

Petroleum Minister Hardeep Puri, in a post on X, said the amendments would strengthen India’s energy security and self-sufficiency.

The Petroleum Ministry, in a statement, emphasised that the move would help boost oil and gas exploration while providing a more predictable business environment.

‘Better late than never’: ONGC’s former chairman RS Sharma

Speaking to CNBC-TV18, former ONGC chairman RS Sharma welcomed the amendments but stressed that the reforms should have come years ago. “This bill is improving the ease of doing business. It does not bring big-ticket reforms or attract new investments in exploration, but it does facilitate existing operations by improving legal frameworks and resource-sharing,” he said.

Also read: Oil firms shielded from sudden levies as Parliament clears Oilfields Act amendments

Sharma noted that the industry had been demanding such changes for two decades. “For no rhyme or reason, it was not done. But now it is being done—better late than never. We have to welcome it,” he added. However, he cautioned that much more needs to be done to promote exploration in India.

Deloitte India: A stable and predictable environment for investors

Sanjay Sah, Partner at Deloitte India, called the amendments a “great development” and a significant step forward for both large and small investors.

“This bill enables investors to share resources, allows the government to merge lease areas, and removes certain criminal offences,” Sah told CNBC-TV18. He highlighted that the law now provides clearer arbitration mechanisms and a structured penalty framework, boosting confidence in the sector.

From an international investor’s perspective, Sah said the bill enhances ease of doing business by reducing uncertainty around dispute resolution and penalties. “Most global players have concerns about how issues will be resolved and whether penalties will be imposed arbitrarily. This bill offers clarity on arbitration, including international arbitration, and ensures that penalties follow a structured process,” he explained.

Sah also pointed out that the amendments provide much-needed clarity on resource ownership. “If a company discovers coal-bed methane or shale, this act ensures that the resource stays with that operator. The environmental regulations have also been clearly defined, making it easier for companies to navigate compliance,” he said.

With these reforms, industry experts believe India has taken an important step in improving investor confidence and operational stability in the oil and gas sector. However, they stress that further reforms are necessary to truly unlock the sector’s exploration potential.





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