Quote on Pre-Budget by Dr. Kapil Garg, Managing Director, Asian Energy Services Limited
Below the Quote on Pre-Budget by Dr. Kapil Garg, Managing Director, Asian Energy Services Limited
“The oil and gas sector has experienced considerable momentum in recent months, and sustaining this growth hinges on focused policymaking in the Union Budget 2025. First and foremost would be the passage of the Oilfield (Regulation and Development) Amendment Bill in the Lok Sabha, which can mark a turning point for the industry. The proposed changes will expedite approvals, simplify arbitration processes, and particularly benefit unconventional hydrocarbons like shale and coalbed methane, improving not only investments but also enhance resource utilization. Collaboration between public and private players must also be a priority. Initiatives like OLAP, DSF, and PEC have demonstrated the benefits of partnership in unlocking India’s hydrocarbon reserves. Expanding these frameworks and incentivizing private participation will further boost domestic production and reduce import dependency. The recent collaboration between ONGC and BP in Mumbai High can serve as a blueprint for public-private synergies for technological innovation and enhanced production outputs going ahead.
Another important aspect to consider is the need to rationalize gas pricing formulas to minimize price distortions faced by producers and consumers under the existing multi-pricing mechanisms. By adopting a more streamlined formula that aligns with previous frameworks linking gas prices to crude oil benchmarks, India can enhance accessibility to cleaner fuel. These moves would be even more effective if implemented alongside the long-pending inclusion of oil and gas in GST, particularly natural gas. Its implementation would simplify taxation, improve the fuel's competitiveness, and foster greater adoption of natural gas as a cleaner energy source, in line with India’s energy transition goals. The industry would also benefit from capital allocations for expanding midstream infrastructure, including pipelines and gas terminals. India’s current pipeline network, at approximately 20,000 kilometers, falls short of meeting future demand. Expanding this network and modernizing fuel transport infrastructure are critical to de-bottlenecking supply chains and unlocking production potential in newly explored basins.
Above views are of the author and not of the website kindly read disclaimer
