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Core Purpose

The Central Government amends the Schedule to the Oilfields (Regulation and Development) Act, 1948, by exercising powers conferred under sub-section (4) of section 6A of the said Act.

Detailed Summary

The Ministry of Petroleum and Natural Gas, through Notification S.O. 2860(E) dated June 4, 2026, has amended the Schedule to the Oilfields (Regulation and Development) Act, 1948 (53 of 1948), with effect from May 11, 2026. The amendment primarily substitutes paragraph 1 of the Schedule, revising the Royalty Rates for production of Crude Oil and Casing Head Condensate across various regimes and policies. For areas awarded on nomination basis to National Oil Companies, Onland royalty is 20%, Shallow Water 10%, Deep Water is 5% for the first 7 years then 10% thereafter, and Ultra-Deep Water is 10% from the 8th year. Under the New Exploration Licensing Policy, Onland royalty is 12.5%, Shallow Water 10%, Deep Water is 5% for the first 7 years then 10% thereafter, and Ultra-Deep Water is 5% for the first 7 years then 5% thereafter. For areas under the Discovered Small Field Policy and Hydrocarbon Exploration Licensing Policy, Onland royalty is 12.5%, Shallow Water 7.5%, Deep Water is 0% for the first 7 years then 2% thereafter, and Ultra-Deep Water is 2% from the 8th year. Royalty for Offshore Discovered Fields awarded to Joint Venture Contractors prior to the New Exploration Licensing Policy is determined by their respective Production Sharing Contracts. The notification also modifies paragraph 5, specifying that royalty shall be computed on a cum-royalty basis for Onland areas awarded on nomination basis to National Oil Companies, Onland Exploration Blocks, and Onland Discovered Fields Contracts awarded to Private or Joint Venture Contractors prior to the New Exploration Licensing Policy. For all Offshore areas (Shallow Water, Deep Water, and Ultra-Deep Water) under all regimes and policies, and other Onland areas/contracts, royalty shall be computed on an ex-royalty basis. The Schedule was originally inserted by Act 39 of 1969 and previously amended by G.S.R. 814 (E) dated December 16, 2004, G.S.R. 559 (E) dated August 20, 2007, S.O. 615 (E) dated August 28, 2009, S.O. 173(E) dated January 15, 2016, S.O. 367 (E) dated January 14, 2019, S.O. 1597 (E) dated April 11, 2019, S.O. 4382(E) dated October 20, 2021, and S.O. 2376 (E) dated May 08, 2026.

Full Text

REGD. No. D. L.-33004/99 The Gazette of India CG-DL-E-04062026-273152 EXTRAORDINARY PART II-Section 3-Sub-section (ii) PUBLISHED BY AUTHORITY No. 2766] NEW DELHI, THURSDAY, JUNE 4, 2026/JYAISTHA 14, 1948 MINISTRY OF PETROLEUM AND NATURAL GAS NOTIFICATION New Delhi, the 4th June, 2026 S.O. 2860(E).- In exercise of the powers conferred by sub-section (4) of section 6A of the Oilfields (Regulation and Development) Act, 1948 (53 of 1948), the Central Government hereby makes the following amendments, further to amend the Schedule to the said Act, namely: -. 1. In the Oilfields (Regulation and Development) Act, 1948, in the Schedule, - (i) for paragraph 1 and the existing entries, the following paragraph and entries shall be substituted, namely: – "1. Royalty Rates for production of Crude Oil and Casing Head Condensate: +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ | Regime / Policy | Onland | Shallow Water | Deep Water | Ultra-Deep Water | +=================================================================================================================+===========+===============+=============================================================================================================================================================================================================+=================================================================================================================================================================================================================+ | (i) Areas awarded on | 20% | 10% | 5% for the period of first 7 years from the date | 10% from the date of commencement of the 8th | | nomination basis to | | | of commencement of commercial production | year of commercial production and onwards as | | National Oil Companies | | | | well as for production during any other period | +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ | (ii) Exploration Blocks awarded to Private or Joint Venture Contractors prior to New Exploration Licensing | | | 10% from the date of commencement of the 8th year of commercial production and onwards as well as for production during any other period | | | Policy | | | | | | (iii) Onland Discovered Fields Contracts awarded to Joint Venture Contractors prior to New Exploration | | | | | | Licensing Policy | | | | | +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ | (iv) Areas awarded under | 12.5% | 10% | 5% for the period of first 7 years from the date | 5% from the date of | | New Exploration Licensing | | | of commencement of commercial production | commencement of | | Policy | | | | the 8th year of | | | | | 10% from the date of commencement of the 8th | commercial | | | | | year of commercial production and onwards as | production and onwards | | | | | well as for production during any other period | as well as for | | | | | | production during | | | | | | any other period | +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ | (v) Offshore Discovered | | | As specified in the respective Production Sharing Contract | | | Fields awarded to Joint | | | | | | Venture Contractors prior | | | | | | to New Exploration | | | | | | Licensing Policy | | | | | +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ | (vi) Areas awarded under | 12.5% | 7.5% | 0% for the period of first 7 years from the date | 2% from the date of | | Discovered Small Field | | | of commencement of commercial production | commencement of the 8th | | Policy and Hydrocarbon | | | Commercial production in the 8th | year of commercial | | Exploration Licensing | | | period from the date of commencement and | production and onwards | | Policy | | | for any other period | as well as for production | | | | | 2% | during any other | | | | | | period.". | +-----------------------------------------------------------------------------------------------------------------+-----------+---------------+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+ (ii) in paragraph 5, for item (2), the following items shall be substituted, namely: – "(2) The royalty shall be computed on cum-royalty basis for, (a) Onland areas awarded on nomination basis to National Oil Companies; (b) Onland Exploration Blocks awarded to Private or Joint Venture Contractors prior to New Exploration Licensing Policy; and (c) Onland Discovered Fields Contracts awarded to New Exploration Licensing Policy. (3) The royalty shall be computed on ex-royalty basis for all Offshore areas (Shallow Water, Deep Water and Ultra Deep Water) under all regimes and policies and all Onland areas and contracts under regimes and policies except those specified under item (2) of paragraph 5.". 2. This notification shall be deemed to have come into force with effect from the 11th day of May, 2026. [F. No. Expl-11023(1)2020-EXPL-I-PNG (E-33879)] REGHURAM KRISHNA, Under Secy. Note: The Schedule of the Oilfields (Regulation and Development) Act, 1948 was inserted by Act 39 of 1969 and subsequently amended vide G.S.R. 814 (E), dated 16.12.2004, G.S.R. 559 (E), dated 20.08.2007, S.O. 615 (E), dated 28.08.2009, S.O. 173(E), dated 15.01.2016, S.O. 367 (E), dated 14.01.2019, S.O. 1597 (E), dated 11.04.2019, S.O. 4382(E), dated 20.10.2021, S.O. 2376 (E), dated 08.05.2026.

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