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India’s ₹84,084 Crore Samudra Manthan Scheme: What Investors Need to Know
India has approved Samudra Manthan, the National Offshore Exploration Scheme, with a ₹84,084 crore Phase-I outlay running through FY 2030-31.…
New Delhi, August 2026: India is taking a significant step towards expanding its domestic oil and gas exploration ecosystem with the approval of Samudra Manthan, the National Offshore Exploration Scheme.
The scheme carries a Phase-I outlay of ₹84,084 crore up to FY 2030-31 and is designed to accelerate offshore exploration, develop shared infrastructure, encourage domestic manufacturing and reduce the risks associated with deepwater exploration.
For investors, the headline is not simply the size of the government allocation. The more important point is that India is attempting to build an ecosystem around offshore energy, from seismic data and exploration to infrastructure, manufacturing and services.
What has been announced?
The government expects the scheme, subject to exploration success, to support an increase of over 600 MMTOE in hydrocarbon reserves, taking the resource base from 1.6 billion to 2.2 billion Tonnes of Oil Equivalent.
Domestic annual production is targeted to rise from around 62 MMTOE to 80 MMTOE, while additional output could potentially reduce crude imports by nearly ₹1 lakh crore every year. These are government expectations and remain dependent on exploration outcomes.
The scale of the programme is reflected in its allocation:
| Area | Allocation |
|---|---|
| Offshore data acquisition | ₹28,534 crore |
| Offshore exploration acceleration | ₹43,200 crore |
| Shared offshore infrastructure | ₹10,000 crore |
| Oil & gas manufacturing and services zones | ₹2,000 crore |
| Monitoring and support | ₹350 crore |
| Total | ₹84,084 crore |
The largest allocation, ₹43,200 crore, is earmarked for drilling 60 deepwater and ultra-deepwater wells. Financial support can cover up to 50% of eligible drilling costs, or ₹675 crore per well, whichever is lower. The scheme is open to both public and private Exploration and Production operators.
Why this matters beyond oil production
India’s offshore basins are estimated to hold more than 5,600 MMTOE of hydrocarbon potential, with eastern and western offshore basins reaching water depths of up to 3,000 metres.
But offshore exploration is capital intensive and slow. The PIB notes that moving from an exploration block award to commercial production typically takes 5 to 10 years, while a single deepwater exploratory well can cost approximately USD 125-150 million.
That is why the risk-sharing element of Samudra Manthan is important.
The programme is not limited to drilling wells. It also provides ₹28,534 crore for 2D and 3D seismic surveys, ₹10,000 crore for common production and evacuation infrastructure, and ₹2,000 crore for an Oil and Gas Manufacturing and Services Zone.
For investors, this creates a broader value-chain story. If implementation progresses successfully, the opportunity could extend beyond exploration and production into offshore infrastructure, engineering, manufacturing, technology and related services.
The bigger investment takeaway
The immediate mistake would be to treat the announcement as a near-term earnings event.
Offshore exploration has a long gestation period, and the government’s own projections are explicitly subject to exploration success. The more relevant development for long-term investors is the creation of a larger domestic ecosystem around exploration and production.
India has already undertaken several reforms in the sector. The PIB states that more than 99% of earlier “No-Go” areas have been removed, while more than one million square kilometres of India’s Exclusive Economic Zone is now available for exploration.
Under the Open Acreage Licensing Programme, 172 blocks covering nearly 3.8 lakh square kilometres have been awarded, with committed investments exceeding USD 4.3 billion. During FY 2025-26, around 674 wells were drilled, with five new discoveries made and seven discoveries monetised.
The latest development in the Mahanadi Offshore Basin is another important marker. On 25 July 2026, drilling of the first appraisal well began. The MN-DWN18-1-HD is the first of four planned deepwater wells intended to evaluate the basin’s potential.
For sophisticated investors, the question therefore shifts from “Will this announcement benefit oil companies?” to a more useful one:
Which businesses are positioned to participate in the investment cycle created by offshore exploration, infrastructure and domestic energy manufacturing?
That is where company-specific analysis becomes important. Policy announcements create potential opportunities, but valuations, balance sheets, execution capability, order visibility and the actual economics of individual businesses still determine whether an investment is attractive.
What investors should watch next
The most important indicators will be actual exploration activity, drilling progress, commercial discoveries, infrastructure development, private-sector participation and the development of domestic oil and gas manufacturing capabilities.
The distinction between policy ambition and investable opportunity will become clearer as capital moves from government allocation to actual projects, contracts, orders and production.
For investors looking at SME and alternative investment opportunities, this kind of structural policy change can be worth monitoring early, particularly where emerging companies may participate in specialised parts of a developing value chain.
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Artharich is an investment manager focused on India’s SME and emerging-company opportunities. We help investors evaluate SME AIFs, IPOs and Pre-IPO investments with a research-led approach. Speak with Artharich for a complimentary consultation on your investment opportunities.
Warning: This article is for informational and educational purposes only and should not be construed as investment advice, an offer, solicitation or a recommendation to buy or sell any security, fund or financial product. Government projections and policy objectives are subject to implementation and exploration outcomes and do not guarantee investment returns. Investments in SMEs, AIFs, IPOs and Pre-IPOs can involve significant risk, including loss of capital. Investors should evaluate their objectives, risk profile, liquidity requirements and conduct appropriate due diligence before investing.
Source: Press Information Bureau, Government of India, Samudra Manthan – National Offshore Exploration Scheme, posted 3 August 2026. PIB Source: Samudra Manthan – National Offshore Exploration Scheme