Technological interventions have significant potential in stimulating the recovery of hydrocarbon reserves from the mature and aging fields. An increase by 5 per cent in recovery rate of the original in-place volume in oil production is envisaged to produce 120 million tonnes of additional oil in next 20 years," he said.
"In case of gas, an increase of 3 per cent recovery rate on original in-place volume is envisaged, leading to additional production of 52 billion cubic metres of gas in the next 20 years," the Minister added.
Pradhan said oil companies bringing in investment and new technology in exploration would be granted a 50 per cent reduction in cess, while such companies in gas would get a discount in royalty of 75 per cent.
The policy will be applicable to all contractual regimes and nomination fields.
"The policy is expected to facilitate induction of new, innovative and cutting-edge technology and forging technological collaboration to improve the productivity of existing fields," he said.
The policy, with a sunset clause, will be effective for 10 years from the date of its notification.
However, the fiscal incentives will be available for a period of 120 months from the date of commencement of production in such projects, the government said.
"In case of improved recovery projects, the incentives will be available from the date of achievement of the prescribed benchmark. Defined timelines have been prescribed to complete the various processes under the policy," it added.
Commenting on the development, Vedanta Ltd Chief Executive (Oil and Gas) Sudhir Mathur said in a statement that the move would spur the growth of the domestic oil and gas industry.
"This policy will attract much-needed investments, and usher in a wave of best-in-class technologies to improve India's hydrocarbons recovery," he said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)