OALP, NELP & HELP

Imagine your father owns a hundred acres of land. He believes there is gold buried somewhere underneath, but nobody knows exactly where. There are two ways to search for it. In the first, your father marks ten spots himself and asks everyone to dig only there. If there is no gold, years are wasted. In the second, he invites the world's best geologists, lets them study the land and identify the most promising pockets, and only then auctions those specific pockets to the highest bidder. Which method finds gold faster.

That difference is more or less the story of how India's oil exploration policy evolved. Until 1999, exploration in India was largely the job of ONGC and Oil India, two state owned companies drilling wherever the government told them to. In 1999, India introduced NELP, the New Exploration Licensing Policy, to bring private and foreign companies into the hunt. It was a genuine opening up. But it kept one old habit. The government still decided which blocks would be put up for bidding, even though a private company sitting on seismic data might understand a patch of geology far better than a bureaucrat in Delhi.

The commercial structure had a second problem. NELP contracts ran on Profit Sharing, where the government and the operator split whatever profit remained after costs. In practice this created a permanent argument. What exactly counts as an exploration cost. What counts as a legitimate expense before profit is calculated. Disputes dragged on for years, and companies grew wary of putting more capital into new blocks.

Rather than junk seventeen years of experience, the government refined the framework. In 2016 it introduced HELP, the Hydrocarbon Exploration and Licensing Policy. The single biggest change inside HELP was OALP, the Open Acreage Licensing Policy. Under OALP, a company itself identifies the area it wants to explore and simply asks the Directorate General of Hydrocarbons to put that area up for auction, instead of waiting for the government to decide. HELP also swapped Profit Sharing for Revenue Sharing, where the operator simply hands over an agreed percentage of gross revenue to the government from day one. No argument about costs, because costs are irrelevant to the split. A single licence now also covers oil, gas, coal bed methane and shale in one contract area, instead of separate permissions for each.

Nine OALP rounds have been completed since the policy began, awarding roughly 172 blocks across 2.42 lakh square kilometres. Round IX, awarded in April 2025, alone accounted for 28 blocks over 136,596 square kilometres across eight sedimentary basins, including 12 ultra deepwater blocks, with ONGC, Oil India and a Reliance BP consortium among the winners. Round X, launched in February 2025, offered 25 blocks across 13 basins covering nearly 192,000 square kilometres, the largest single OALP offering yet, with over half the acreage in zones that were previously off limits. Round XI followed with 21 more blocks on offer. The petroleum ministry's own estimate is that 42 billion tonnes of oil and oil equivalent gas still sits untapped in Indian basins, and that 76 percent of the area currently under active exploration has only been opened up since 2014.

Whenever you read that ONGC, Oil India, Vedanta or HOEC has picked up a newly awarded exploration block, there is a good chance the story behind it is OALP. Three names across three decades, NELP, HELP, OALP, chasing exactly one objective. Find more oil and gas beneath India's own soil, and let the market rather than a map in Delhi decide where to look.