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Union Government Announces Sops To Increase Oil And Gas Recovery
Oil and Natural Gas Corporation’s wells.
The Narendra Modi-led cabinet approved a slew of incentives for boosting the recovery of oil and gas from old, established sources as well as from new sources like shale and heavy oil. Among the incentives approved are fiscal incentives like reduced cess and royalty.
It is expected that post the announcement of these incentive measures, oil production would rise by 120 million tonnes, while gas output would see a 52 billion cubic metre increase. It is also hoped that the incentive measures would lead to big-ticket players investing considerably in the sector and that cutting-edge technology would be used for the purposes of pumping oil and gas.
Importantly, the new policy announcement would apply to all oil and natural gas fields regardless of whether the same are being operated by a private party after an auction or they are under the control of state firms. It has been reported that under the new policy, the potential of all oil and natural gas fields would be firstly assessed and subsequently, the fiscal incentives would apply as required. Oil ministry and directorate-general of hydrocarbon officials would implement the policy with the aid of experts.
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