India’s next major oil hunt will not begin on land, but far beneath the sea. The Samudra Manthan project aims to map, drill and unlock offshore reserves that could ease import dependence. Yet the promise comes with high costs and long timelines, writes Saurav Anand
What exactly is the Samudra Manthan scheme?
Samudra Manthan, the National Offshore Exploration Scheme, is the government’s biggest offshore oil and gas exploration programme. Approved as a Central Sector Scheme of the ministry of petroleum and natural gas, it will run through FY 2030-31. The total outlay for the project is Rs 84,084 crore.
Its purpose is to reduce the risk of searching for hydrocarbons beneath India’s seas. Companies must map rock formations, identify promising locations and drill wells that may still turn out dry. The scheme combines better geological data, government support for drilling, common production infrastructure and domestic manufacturing.
It follows reforms that opened more than 99% of previously restricted offshore “No-Go” areas. Over one million square kilometres of India’s Exclusive Economic Zone is now available for exploration. The focus will be on deepwater and ultra-deepwater prospects in the Krishna-Godavari, Cauvery, Mahanadi and Andaman regions.
How will the money be spent?
The largest allocation Rs 43,200 crore, is for drilling 60 deepwater exploration wells. The government can support up to 50% of the eligible cost, capped at Rs 675 crore per well. This matters because one deepwater exploratory well can cost $125-150 million.
Another Rs 28,534 crore is for modern offshore data. It includes Rs 12,000 crore for basin-wide 2D seismic surveys, Rs 12,534 crore for 3D surveys and other techniques, and Rs 4,000 crore for reprocessing existing data and using artificial-intelligence tools.
The scheme provides Rs 10,000 crore for common offshore infrastructure hubs. These could allow discoveries to share pipelines, platforms and evacuation systems instead of each operator building everything separately. Another Rs 2,000 crore will create oil and gas manufacturing and services zones, while Rs 350 crore is for monitoring, digital systems, skills and outreach.
Why does India need such a large offshore push now?
India imports close to nine-tenths of its crude oil requirement and about half of the natural gas it consumes. The government puts the annual crude import bill at nearly $144 billion, or around Rs 13 lakh crore. This exposes the economy to wars elsewhere in the world, shipping disruptions, price spikes and pressure on the rupee.
Domestic output has also struggled. Crude production was 28.71 million tonne in FY 2025-26 and fell 2.8% during the year. Existing oil and gas fields naturally decline by about
6-7% annually, so fresh discoveries are needed even to stop production from slipping further.
The push follows gas discoveries in the Andaman region, which improved interest in a frontier basin with limited exploration. However, promising geology does not guarantee commercial reserves. The scheme aims to improve the odds through better data and shared drilling risk.
What difference could it make to energy security?
The government aims to raise annual domestic oil and gas production from about 62 million tonne of oil equivalent (MMTOE) to 80 MMTOE. It also aims to expand India’s hydrocarbon resource base from 1.6 billion tonne of oil equivalent (TOE) to 2.2 billion TOE, an increase of more than 600 MMTOE.
Additional production could eventually reduce crude imports by nearly Rs 1 lakh crore a year. It would also lower exposure to freight disruptions, foreign-exchange volatility and geopolitical shocks. Better seismic information could attract private and global explorers, while shared infrastructure may make smaller discoveries commercially viable.
Manufacturing and services zones could also build Indian capacity in specialised equipment, engineering and offshore services. A resource estimate, however, is not the same as recoverable production. The scheme does not give a confirmed oil-gas split or a year-wise output profile.
What are the biggest risks?
Geological uncertainty is the biggest risk. A costly well may find nothing, while a discovery may be too small or difficult to produce economically. Offshore work also demands strict environmental and safety oversight, advanced technology, skilled workers and disciplined execution. The real tests will be commercially recoverable discoveries, private investment, speed to production and environmental compliance.
The technical service provider route can improve mature producing assets such as Mumbai High, where BP has been engaged to identify reservoir, well and facility improvements. Frontier exploration, however, will also require risk-sharing, multi-client data, farm-outs, joint ventures, stable fiscal terms and firm drilling commitments.
Samudra Manthan can improve long-term resilience, but only if better data leads to drilling, drilling produces commercial discoveries and those discoveries are converted into producing fields.