India rationalises royalty rates to boost upstream oil & gas sector

The Indian government has rationalized royalty rates under the ORD Act to boost the upstream oil and gas sector. Union Minister Hardeep Singh Puri hailed the move as a 'new era,' saying it will eliminate inconsistencies and create a stable framework.

Highlighting the need to remove long-standing inconsistencies across regimes and to ensure a stable framework for India's upstream sector, the government has rationalized royalty rates under the Oilfields (Regulation and Development) Act to drive growth in the upstream sector.

Rationalisation Marks 'New Era' for Upstream Sector

Union Minister for Petroleum and Natural Gas Hardeep Singh Puri on X, credited Prime Minister Narendra Modi for his leadership in rationalizing the Act. "In a big boost for the country's Upstream Sector, rationalization of royalty under the ORD Act marks a new era for our Oil & Gas regimes by eliminating inconsistencies and driving growth in the upstream sector under the leadership of PM Sh @narendramodi Ji. This landmark decision will be a major step toward regulatory clarity," Puri said.

Puri also lauded the move, hailing it as a new era for India's oil and gas regimes by eliminating long-standing inconsistencies. This decision followed the 2025 amendments to the ORD Act and Petroleum and Natural Gas Rules, which established new methodologies for royalty on crude oil, natural gas, and casing head condensate.

Stable Framework to Fuel India's Energy Future

"This landmark decision will be a major step toward regulatory clarity. Following the historic 2025 amendments to the ORD Act & PNG Rules, the Government has rationalized royalty rates & methodologies for Crude Oil, Natural Gas, and Casing Head Condensate. The revised Schedule removes long-standing inconsistencies across regimes to ensure a stable, predictable, and investor-aligned framework for India's upstream sector," Puri said.

The minister noted that the regulatory shift represented the conclusion of a decade-long initiative aimed at replacing complex rules with a consistent system to secure India's energy future. "The revised Schedule removes long-standing inconsistencies across regimes to ensure a stable, predictable, and investor-aligned framework for India's upstream sector. This decision is a culmination of a decade-long effort to modernize our regulatory landscape by replacing complexity with consistency to fuel India's energy future," he added.

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