Rs 84,084 crore incentive on offer, but India's deepsea oil exploration bids delayed again

India has given oil companies another month to decide whether to venture into its deep and ultra-deepwater oil and gas blocks, extending the bidding deadline under its 10th and 11th Open Acreage Licensing Policy (OALP) rounds to December 10, 2026.

The latest postponement, the seventh for OALP-X and the third for OALP-XI, showed the difficulty of drawing investors into high-cost offshore exploration even as the government rolls out financial incentives and regulatory reforms to stimulate domestic hydrocarbon production, PTI reported on November 9.

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Directorate General of Hydrocarbons (DGH), the upstream oil and gas nodal agency under the petroleum ministry, announced the revised deadline on its website.

While the agency did not disclose the reason, industry sources said that companies may be seeking additional time to assess the financial assistance offered under the recently unveiled Rs 84,084 crore Samudra Manthan National Offshore Exploration Scheme.

The government released the scheme's operational guidelines on October 22. The framework provides for financial assistance of up to 50% of eligible deepwater and ultra-deepwater exploration drilling expenditure, subject to a maximum of Rs 675 crore per well.

The additional time could help prospective bidders evaluate how this support changes the commercial viability of the acreage on offer.

OALP-X: Seven deadline extensions

Launched in February 2025, the 10th OALP round offered 25 blocks spanning approximately 1,82,589 sq km across 13 sedimentary basins. It was the largest licensing round by acreage at the time. The offering comprised six onshore, six shallow-water, one deepwater and 12 ultra-deepwater blocks.

Of the total, 19 were offshore blocks, including 13 deepwater and ultra-deepwater areas covering around 1,24,327 sq km. Bidding for onshore and shallow-water acreage concluded on June 19, 2026.

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The deadline for the remaining blocks, originally scheduled to close at the end of July 2025, was successively pushed to October 31 and December 31, 2025, February 18 and June 19, 2026, September 17 and November 15, before the latest extension to December 10.

OALP-XI: Third extension

The 11th licensing round, launched in March 2026, comprises 21 blocks covering 80,234.49 sq km across 11 sedimentary basins. These include 12 onshore blocks, four shallow-water blocks, one deepwater block and four ultra-deepwater blocks. Nine offshore blocks account for approximately 45,296 sq km.

Bidding opened on March 30, with the onshore and shallow-water component closing on June 19. The deadline for deepwater and ultra-deepwater acreage was subsequently moved from September 17 to November 15 and has now been shifted to December 10.

Government steps in to reduce risk

The Samudra Manthan scheme, approved by the Union Cabinet in July, has an outlay of Rs 84,084 crore through FY31. It aims to unlock more than 600 million tonnes of additional oil-equivalent hydrocarbon resources.

Its allocations include Rs 28,534 crore for offshore seismic data acquisition and processing, Rs 43,200 crore for accelerated offshore exploration, including 60 deepwater exploration wells, Rs 10,000 crore for common offshore infrastructure and Rs 2,000 crore for oil and gas manufacturing and services zones.

It may be noted here that a single deepwater exploratory well can cost an estimated $125 million to $150 million, according to the petroleum ministry. Under the scheme, government support is limited to Rs 675 crore per well or 50% of eligible expenditure, whichever is lower.

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For India, the stakes extend beyond attracting investment. The country imports more than 88% of its crude oil requirements, making domestic hydrocarbon discoveries critical to strengthening energy security and reducing dependence on overseas supplies.

Introduced in 2016 under the Hydrocarbon Exploration and Licensing Policy, OALP sought to replace the government-driven identification of exploration blocks with an investor-led system that allows companies to nominate acreage they wish to explore.

Other reforms have included replacing production-sharing contracts with revenue-sharing arrangements, granting marketing and pricing freedom for produced hydrocarbons, amending the Oilfields (Regulation and Development) Act and revising contractual provisions. The government has also opened up substantial offshore areas that were previously restricted.