Why in the News?
Recently, the Oilfields (Regulation and Development) Amendment Bill, 2024 was passed in the Rajya Sabha to amend the Oilfields (Regulation and Development) Act, 1948.
More on the News
- The Bill seeks to encourage domestic production of petroleum and mineral oils, attract private investment in these sectors, and reduce import dependence to enhance energy self-reliance.
- Key Provisions of the Bill
- Expanded definition of mineral oils: Expands 'mineral oils' to include hydrocarbons, coal bed methane, and shale gas/oil, excluding coal, lignite, and helium.
- Introduction of Petroleum lease: It seeks to replace the mining lease with a petroleum lease, covering similar activities like exploration, prospecting, production, and disposal of mineral oils.
- Rule-making powers of Central Government: Grants powers for merging petroleum leases, sharing production/ processing facilities, environmental protection and emission reduction, alternative dispute resolution mechanisms.
- Decriminalization of offences: Replaces imprisonment and minor fines with a penalty of ₹25 lakh for violations.
- Adjudication of penalties: Designates a Joint Secretary or above as Adjudicating Authority; appeals handled by Petroleum and Natural Gas Board Regulatory Board (PNGRB) Tribunal under the 2006 Act. PNGRB regulates refining, transport, storage, and sale of petroleum and natural gas.
How Will the Oilfields Amendment Bill Shape the Future of Oil Exploration?
- Encourages domestic production and reduce import dependency: Currently, India imports over 85% of its crude oil needs. Introduction of petroleum leases and the broadening of mineral oil definitions to include various hydrocarbons aim to boost domestic output and reduce imports.
- Attracts private investment: Includes provisions to foster private sector participation while protecting the rights of existing lessees.
- Policy modernization: Aligns regulatory provisions with contemporary energy needs and practices to enhance governance in the petroleum sector.
- Clear legislative demarcation: Establishes a clear distinction between the Oilfields Act (for petroleum and mineral oils) and the Mines and Minerals Act (for other minerals).
