On 18 July 2018, the Cabinet Committee on Economic Affairs approved policy framework for streamlining operations of production sharing contracts (PSCs) for increased domestic production of hydrocarbon resources (Policy).
By way of background, the Government of India had awarded 28 exploration blocks (13 offshore and 15 onshore) to private companies between 1980. This was prior to the implementation of New Exploration Licensing Policy (NELP) where Oil and Natural Gas Corporation Limited and Oil India Limited have the right of participation in the blocks after hydrocarbon discoveries. In 2017, the Government of India had approved policy to grant extension of 10 years to PSCs awarded under the pre-NELP blocks. Now, for pre-NELP blocks, the Policy provides for: (i) sharing and cost recovery of levies; and (ii) tax benefits.