The government notified the Petroleum and Natural Gas Rules, 2025, aiming to streamline India’s oil and gas sector and boost investment. Issued under the Oilfields (Regulation and Development) Amendment Act, 2025, the rules replace multiple licences with a single petroleum lease covering exploration, development, and production of all hydrocarbons, including unconventional resources. Authorities can now grant leases for up to 30 years and extend them for the full economic life of a field, while ensuring safeguards against adverse regulatory changes.
Shift from Criminal Penalties to Fines
To encourage compliance without punitive measures, the rules remove criminal penalties for violations. Instead, companies may face fines of up to Rs 25 lakh, with additional Rs 10 lakh per day for ongoing non-compliance. The rules actively promote joint infrastructure development and mandate time-bound plans to achieve zero routine gas flaring and reduce greenhouse gas emissions.
Faster Approvals and Dispute Resolution
To expedite sector operations, petroleum lease applications must be decided within 180 days. The rules also introduce a streamlined dispute resolution mechanism. Additionally, the Oil Industry Safety Directorate will oversee offshore safety, audits, and operational standards, ensuring both compliance and operational efficiency. As reported by projectstoday.com, these changes collectively aim to simplify regulatory processes, enhance investment attractiveness, and align India’s oil and gas sector with global best practices.
