On July 31, 2026, the Union Cabinet approved Samudra Manthan – National Offshore Exploration Scheme with a Phase-I outlay of ₹84,084 crore up to FY 2030–31. Formulated by the Ministry of Petroleum and Natural Gas, the mission aims to unlock India's vast deepwater and ultra-deepwater hydrocarbon potential. By de-risking high-cost E&P ventures and adding over 600 MMTOE of oil and gas reserves, the initiative seeks to reduce crude import dependency, strengthen energy self-reliance, and boost domestic offshore technology manufacturing.
The Union Cabinet approved Samudra Manthan – National Offshore Exploration Scheme on July 31, 2026. The government announced the mission to accelerate deepwater crude oil and natural gas exploration. The primary trigger is India's high crude oil import dependency (above 85%), which poses risks to macro-economic stability and foreign exchange reserves during global supply disruptions.
The scheme was approved on July 31, 2026, in New Delhi. It covers India's entire offshore domain, including the Bay of Bengal, the Arabian Sea, and frontier deepwater areas extending up to 3,000 metres water depth across India's Exclusive Economic Zone (EEZ).
1. Risk Sharing: Government provides direct financial assistance covering up to 50% of eligible drilling costs (capped at ₹675 crore per well) for 60 deepwater wells.
2. Acreage Opening: More than 99% of restricted "No-Go" maritime zones are cleared, exposing 1+ million sq km of EEZ.
3. Common Infrastructure: Shared offshore facilities and digital project tracking reduce operational overheads for E&P firms.
4. Domestic Supply Chain: Incentivises local manufacturing of subsea equipment and specialized E&P vessels under Make in India.
India imports over 85% of its crude oil needs, whereas global peers like Brazil (Pre-Salt fields) and Guyana transformed from net importers to major offshore exporters using targeted deepwater exploration incentives and risk-sharing models.
Core Concept: Hydrocarbon Exploration and Licensing Policy (HELP)
Q1. What is the total financial outlay for Phase-I of the Samudra Manthan Scheme up to FY 2030–31? [Easy]
A) ₹43,200 crore
B) ₹84,084 crore
C) ₹50,000 crore
D) ₹1,00,000 crore
Answer: B
Explanation: The Samudra Manthan Scheme was approved with a Phase-I financial outlay of ₹84,084 crore extending up to FY 2030–31.
Q2. Which Ministry is the nodal administrative body for the Samudra Manthan Scheme? [Easy]
A) Ministry of Earth Sciences
B) Ministry of Mines
C) Ministry of Petroleum and Natural Gas
D) Ministry of New and Renewable Energy
Answer: C
Explanation: The Ministry of Petroleum and Natural Gas formulates and oversees the implementation of the Samudra Manthan Scheme.
Q3. Under the Samudra Manthan scheme, what is the maximum financial support provided per deepwater exploration well? [Moderate]
A) Up to 30% cost or ₹400 crore
B) Up to 50% cost or ₹675 crore
C) Up to 60% cost or ₹800 crore
D) Up to 100% cost or ₹500 crore
Answer: B
Explanation: Financial support covers up to 50 percent of eligible drilling costs, or ₹675 crore per well, whichever is lower, for 60 deepwater wells.
Q4. What target volume of hydrocarbon reserves accretion is aimed under the Samudra Manthan mission? [Moderate]
A) Over 300 MMTOE
B) Over 600 MMTOE
C) Over 1000 MMTOE
D) Over 1500 MMTOE
Answer: B
Explanation: The scheme explicitly aims to add over 600 Million Metric Tonnes of Oil Equivalent (MMTOE) of hydrocarbon reserves.
Q5. In July 2026, spudding for the first appraisal well (MN-DWN18-1-HD) commenced in which offshore basin? [Moderate]
A) Krishna-Godavari Offshore Basin
B) Mumbai High Offshore Basin
C) Mahanadi Offshore Basin
D) Cauvery Offshore Basin
Answer: C
Explanation: The first appraisal well MN-DWN18-1-HD commenced drilling in the Mahanadi Offshore Basin on July 25, 2026.
Q6. Statement I: Revenue Sharing Contracts (RSC) require government audit of contractor exploration costs before profit division. Statement II: HELP introduced Open Acreage Licensing Programme allowing E&P operators to choose their own blocks. [Tricky]
A) Both Statement I and Statement II are correct
B) Statement I is correct but Statement II is incorrect
C) Statement I is incorrect but Statement II is correct
D) Both Statement I and Statement II are incorrect
Answer: C
Explanation: Statement I is incorrect because cost auditing was a feature of Production Sharing Contracts (PSC), whereas Revenue Sharing Contracts (RSC) share gross revenue directly without auditing costs. Statement II is correct.
Q7. What percentage of previously classified "No-Go" offshore maritime areas have been opened for hydrocarbon exploration? [Tricky]
A) Exactly 50 percent
B) Over 75 percent
C) Over 99 percent
D) 100 percent without exception
Answer: C
Explanation: Over 99 percent of earlier "No-Go" offshore areas have been cleared, unlocking over 1 million square kilometres of EEZ.
Q8. Under the United Nations Convention on the Law of the Sea (UNCLOS), up to what distance from the baseline does the Exclusive Economic Zone (EEZ) extend? [Tricky]
A) 12 nautical miles
B) 24 nautical miles
C) 200 nautical miles
D) 350 nautical miles
Answer: C
Explanation: The EEZ extends up to 200 nautical miles from the coastal baseline, giving coastal states sovereign rights over living and non-living natural resources.
PYQ 1:
With reference to India's hydrocarbon sector policies, consider the Hydrocarbon Exploration and Licensing Policy (HELP). Which of the following is a key feature of HELP?
A) Cost recovery requirement before revenue sharing
B) Mandatory government participation in all E&P ventures
C) Single uniform license for all conventional and unconventional hydrocarbons
D) Fixed pricing determined exclusively by the Tariff Commission
Answer: C
Explanation: HELP introduced a uniform single license covering all forms of hydrocarbons, including crude oil, natural gas, coal bed methane, and shale gas.
PYQ 2:
Consider the following statements regarding the Samudra Manthan Scheme:
1. It provides financial risk-sharing support for drilling deepwater and ultra-deepwater wells.
2. It is strictly restricted to public sector enterprises like ONGC and Oil India Limited.
3. It aims to reduce India's import dependency on crude oil and natural gas.
Which of the above statements are correct?
A) 1 and 2 only
B) 1 and 3 only
C) 2 and 3 only
D) 1, 2 and 3
Answer: B
Explanation: Statement 2 is incorrect because the scheme is open to both public and private Exploration and Production (E&P) operators. Statements 1 and 3 are correct.
PYQ 3:
Given below are two statements, one labelled as Assertion (A) and the other as Reason (R):
Assertion (A): Deepwater hydrocarbon exploration involves significantly higher financial risk compared to onshore E&P operations.
Reason (R): High capital costs, deep seabed water depths, and complex subsea technology requirements result in long gestation periods and uncertain commercial success.
In light of the above statements, choose the correct answer:
A) Both (A) and (R) are true and (R) is the correct explanation of (A)
B) Both (A) and (R) are true but (R) is NOT the correct explanation of (A)
C) (A) is true but (R) is false
D) (A) is false but (R) is true
Answer: A
Explanation: High capital outlay, deep water depths (up to 3,000m), and technological complexity make deepwater drilling extremely high-risk, which is why the Reason correctly explains the Assertion.
Question 1 (150 words): Discuss how the Samudra Manthan scheme addresses the inherent financial and technological risks of deepwater hydrocarbon exploration in India.
The Samudra Manthan scheme directly targets the high financial capital intensity and technological barriers that historically constrained India's deepwater exploration. Deepwater drilling down to 3,000 metres involves long gestation periods and substantial capital deployment with unproven commercial yields. By establishing a dedicated risk-sharing mechanism, the scheme allocates ₹43,200 crore to subsidise up to 50 percent of eligible drilling costs, capped at ₹675 crore per well for 60 deepwater and ultra-deepwater wells.
Furthermore, the initiative opens over 99 percent of previously restricted "No-Go" offshore areas, unlocking over 1 million square kilometres of Exclusive Economic Zone (EEZ). By inviting both public and private E&P operators under a standardized framework, it lowers entry barriers and encourages modern technology adoption. Coupled with an allocation of ₹350 crore for digital monitoring and technical capacity building, Samudra Manthan creates a de-risked investment ecosystem essential for domestic resource accretion.
Question 2 (250 words): Evaluate the strategic importance of unlocking India's offshore hydrocarbon potential for achieving energy self-reliance and macroeconomic stability under Viksit Bharat 2047.
Energy security constitutes the foundational pillar of India's economic growth trajectory. Currently, India imports over 85 percent of its crude oil requirements, exposing the domestic economy to international geopolitical disruptions, ocean trade route vulnerabilities, and volatile global commodity prices that strain foreign exchange reserves. Unlocking offshore sedimentary basins through the Samudra Manthan scheme represents a decisive policy transition toward energy self-reliance.
Historically, India's exploration landscape relied heavily on onshore and shallow-water fields. However, vast untapped prospective reserves lie in deepwater and ultra-deepwater offshore domains, such as the Mahanadi, Krishna-Godavari, and Andaman basins. By targeting an accretion of over 600 MMTOE in hydrocarbon reserves through a Phase-I financial outlay of ₹84,084 crore up to FY 2030–31, the mission directly supports domestic E&P scaling. This expansion is reinforced by structural reforms including the Hydrocarbon Exploration and Licensing Policy (HELP), Revenue Sharing Contracts (RSC), and the Oilfields (Regulation and Development) Amendment Act, 2025.
Beyond primary energy security, the scheme generates substantial economic multipliers. Financial incentives for offshore infrastructure foster domestic manufacturing of specialized subsea equipment, advancing the Make in India agenda. Moreover, increased domestic production insulates fiscal management by conserving foreign exchange and generating sustainable royalty revenues for government state exchequers. To maximize benefits, India must ensure seamless environmental clearances, fast-track deepwater technology partnerships, and maintain regulatory consistency to firmly anchor national energy security by 2047.