Govt launches Draft Petroleum & Natural Gas Rules 2025, invites feedback

New Delhi: On Wednesday, the Petroleum Ministry launched a New Draft Petroleum and Natural Gas Rules, 2025, which aims for the reforms to strengthen investor confidence, facilitate operations of India’s energy framework to make them globally sustainable and achieve decarbonization targets.

The government has invited feedback from industry stakeholders, experts, and the public on the draft rules, the revised Model Revenue Sharing Contract (MRSC), and the updated Petroleum Lease format as well.

The Suggestions can be submitted via email to png-rules@dghindia.gov.in by July 17. The public consultation process will conclude at Urja Varta 2025.

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As per the government’s vision, the new draft rules are meant to substitute the Petroleum Concession Rules, 1949, and the Petroleum and Natural Gas Rules, 1959 and this would amendment the Oilfields (Regulation and Development) Act, 1948.

The main features of the draft rules is the induction of the stabilization clause which is designed to protect lessees from future legal or fiscal uncertainties such as hikes in taxes or royalties. The companies under this clause might be compensated or allowed deductions in case of stringent policy shifts to ensure a secure investment environment.

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Further, this norm also proposes the establishment of a dedicated Adjudicating Authority, not below the rank of Joint Secretary, to enforce compliance, resolve disputes, and impose penalties and other significant provisions include streamlined processes for lease mergers, extensions, and unitisation of reservoirs across multiple blocks to enhance operational flexibility.

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