In a historic first, Assam is set to become the inaugural Indian state whose government will directly produce and financially benefit from crude oil. This development follows a notable hydrocarbon discovery in the Namrup Borhat-1 well, which is located within the state.

Assam Chief Minister Himanta Biswa Sarma took to X (formerly Twitter) on Wednesday to confirm the breakthrough, describing it as a “proud moment” for the state. The exploration was undertaken by Oil India Limited (OIL), a public sector enterprise under the Ministry of Petroleum and Natural Gas, in which the Assam government holds a ‘significant’ stake.

“This discovery makes Assam the first state government to be a direct oil producer. It makes exploration efforts successful, empowers Assam with revenue and royalty, and ensures steady availability of energy for the country,” Sarma posted.

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Located in Dibrugarh district, the Namrup Borhat-1 hydrocarbon reserve is being regarded by many experts as a great strategic find not only for the state but for India’s broader oil and gas sector. 

Analysts suggest that this finding will help Assam transition from a resource-supplying state into an active partner in oil production, unlocking new avenues for generating revenues and royalties at the state level.

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Assam’s contribution to the oil economy 

For decades, Assam has been a rather crucial component of  India’s oil economy. It was home to the country’s first oil discovery at Digboi in 1889, and remains a key player in crude output even today.

Figures from the Ministry of Petroleum and Natural Gas indicate that in 2023–24, Assam produced 4,361 thousand metric tonnes (TMT) of crude, placing it third in India after Rajasthan and Gujarat. Between 2021–22 and 2023–24, Assam contributed 12,518 TMT to the country’s overall crude production of 88,223 TMT.