India Unveils Draft PNG Rules 2025 to Modernise Oil & Gas Framework; Feedback Invited by July 17
By Shishta Dutta | Published at: Jul 9, 2025 05:42 PM IST
New Delhi, July 9, 2025 — The Ministry of Petroleum and Natural Gas has rolled out the Draft Petroleum & Natural Gas Rules, 2025, introducing a sweeping set of reforms aimed at modernising India’s upstream oil and gas exploration framework. The announcement comes ahead of Urja Varta 2025, to be held on July 17 at Bharat Mandapam, and invites public and industry feedback by July 17, 2025, via png-rules@dghindia.gov.in.
Union Minister Hardeep Singh Puri described the initiative as part of a broader effort to enhance ease of doing business, attract global investments, and promote decarbonisation in the sector.
Key Highlights of the Draft Rules
Key reforms include the introduction of a stabilisation clause to protect investors from sudden fiscal or regulatory shifts, along with a mandate for shared access to underutilised infrastructure, such as pipelines and facilities, ensuring fair third-party participation.
In a move toward greener operations, the rules also permit renewable energy projects including solar, wind, hydrogen, and geothermal within oil blocks, provided safety protocols are met.
| Reform Area | Key Features |
|---|---|
| Investor Stability | Introduction of a stabilisation clause to safeguard lessees from adverse fiscal/regulatory changes |
| Infrastructure Sharing | Mandates declaration of underutilised pipelines/facilities and fair third-party access |
| Renewables Integration | Allows solar, wind, hydrogen, and geothermal projects within oil blocks under safety constraints |
| Environmental Compliance | New mandates for GHG monitoring, carbon capture/storage (CCS), and post-closure site monitoring |
| Data Governance | Government ownership of all operational data and physical samples; 7-year confidentiality window |
| Legal & Regulatory Oversight | Establishment of an Adjudicating Authority (not below Joint Secretary) for compliance and dispute resolution |
| Lease & Reservoir Management | Clearer processes for lease mergers, extensions, and unitisation of multi-block reservoirs |
Associated Reforms
- Model Revenue Sharing Contract (MRSC): Updated to align with the proposed rules, with clearer provisions on unitisation and infrastructure sharing.
- Revised Petroleum Lease Format: Streamlines lease relinquishment, extension, and termination processes.
Background and Legislative Context
The Draft PNG Rules, 2025, aim to replace the Petroleum Concession Rules, 1949, and Petroleum & Natural Gas Rules, 1959, forming part of the broader legislative overhaul that began with the amendment of the Oilfields (Regulation and Development) Act, 1948. The reforms are strategically timed ahead of OALP Round X, which is expected to be India’s largest-ever exploration bidding round.
Ministerial Remarks
“It has never been easier, faster, and more profitable to explore oil & gas in India,” said Hardeep Singh Puri, Minister of Petroleum and Natural Gas, Puri emphasised the government’s commitment to building a transparent, sustainable, and investor-friendly regime to meet India’s energy transition goals.
REF: https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=2143395
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