The Business Bytes
TBB BUREAU
NEW DELHI, JUNE 29, 2022
The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi, has approved ‘Deregulation of Sale of Domestically Produced Crude Oil’, whereby Government has decided to cease allocation of crude oil and condensate w.e.f. 01.10.2022. This will ensure marketing freedom for all Exploration and Production (E&P) operators.
The condition in the Production Sharing Contracts (PSCs) to sell crude oil to Government or its Nominee or Government Companies shall accordingly be waived off.
All E&P companies will now be free to sell crude oil from their fields in domestic market. Government revenues like Royalty, cess, etc. will continue to be calculated on uniform basis across all Contracts. As earlier, exports will not be permissible.
This decision will further spur economic activities, incentivize making investments in upstream oil and gas sector and builds on a series of targeted transformative reforms rolled out since 2014.
The policies relating to production, infrastructure and marketing of oil and gas have been made more transparent with a focus on ease of doing business and facilitating more operational flexibility to operators/industry.
