The government has taken a big step to find new sources of energy within the country. The Directorate General of Hydrocarbons (DGH) has offered 21 new blocks for oil and natural gas exploration under the 11th phase of the Open Acreage Licensing Policy (OALP). Under this new announcement of the government, a total of 80,235 square kilometers area will be put up for auction. A total of 21 blocks are included in this new list released by DGH. Of these, 12 blocks are located in land areas, 4 in shallow water, 1 in deep sea and 4 in ultra-deep sea areas. However, the start and end dates of bid submission for these blocks are yet to be announced.
To make the auction process transparent, the blocks have been divided into different categories. ‘Category-1’ includes those 14 blocks from where oil and gas production has already been certified on a commercial scale. Here, the company that will give the highest share of revenue to the government and present the best work program will win. At the same time, blocks for ‘Category-2’ (where hydrocarbons are present but commercial production has not started) and ‘Category-3’ (where there are geological possibilities but no discoveries have been made) will be given to those companies which will present the largest and concrete blueprint for seismic survey and drilling of wells.
Tenth phase auction still incomplete
An interesting aspect amidst the announcement of this 11th phase is that the bids for the 10th phase (OALP-X) are yet to come. It is important to note that OALP-X is the largest offering so far, comprising 25 blocks covering an area of approximately 1.91 lakh square kilometers spread across 13 basins. This massive phase was started during the ‘India Energy Week’ organized in New Delhi in February 2025.
Initially the deadline for the end of this auction was fixed as July 2025. But it was extended several times, first to October 2025, then to December 2025, then to 18 February 2026, and now this deadline has slipped to 29 May 2026. Despite the old auction being pending, the announcement of the new phase makes it clear that the government does not want to delay any delay in increasing the production of crude oil in the country.
Companies also benefit from the new policy
In the year 2016, the government had introduced a new policy, which is called ‘Hydrocarbon Exploration and Licensing Policy’ (HELP). This gave companies the freedom to choose areas of their choice that no other company owned, rather than blocks set by the government. Apart from this, facilities like reduction in royalty rates, complete exemption from oil cess (CESS) and freedom to decide the price in the market were also given.
The effect of these new policies has been clearly visible in the previous auctions. For example, 28 blocks spread over 1.36 lakh square kilometers were offered in OALP-IX, in which four major companies participated. In this, government company ONGC won 11 blocks alone and 3 other blocks in partnership with Oil India Limited (OIL). The most important thing was that for the first time, the alliance of Reliance Industries and BP along with ONGC bid for a block in the marine area of Gujarat. Apart from this, Anil Aggarwal’s company Vedanta had bid on all 28 blocks, out of which 7 were named in its name, while Oil India won the remaining 6 blocks.