The Cabinet Committee on Economic Affairs Gave Nod for Shale Gas Exploration and Exploitation
The Cabinet Committee on Economic Affairs on 24 September 2013 approved the proposal on exploration and exploitation of shale gas and oil.
The Cabinet Committee on Economic Affairs on 24 September 2013 approved the proposal of the Ministry of Petroleum and Natural Gas on the policy on exploration and exploitation of shale gas and oil by National Oil Companies (NOCs) on acreages under the nomination regime.
The policy will facilitate NOCs to carry out exploration and exploitation of unconventional hydro-carbon resources particularly shale gas and oil in their already awarded on land Petroleum Exploration License and Petroleum Mining Lease (PEL/PML) acreages under the nomination regime. The policy also contains the terms as well as conditions for guiding these activities.
NOCs shall apply for grant of shale gas and oil rights in their interested PEL or PML acreages and are required to undertake a mandatory minimum work programme. NOCs are permitted three assessment phases of a maximum period of three years each. Royalty, Cess and Taxes would be payable at par with conventional oil and gas being produced from the respective areas.
It is important to note that the production requirements and profile for shale oil and gas is different from conventional gas and oil. Therefore, there was a need of the policy in order to achieve early development of these resources and to address issues arising out of E&P activities in shale gas and oil.