ONGC, Oil India, RIL among stocks in focus as Cabinet clears ₹84,084 crore Samudra Manthan scheme: What it means

Oil & gas stocks such as ONGC, Oil India (OIL), Reliance Industries (RIL), among others, are expected to remain in focus on Monday, August 3, as the Union Cabinet last week approved 'Samudra Manthan' – the National Offshore Exploration Scheme to unlock India's offshore energy potential.

Samudra Manthan is a central sector scheme of the Ministry of Petroleum & Natural Gas with an approved outlay of ₹84,084 crore for implementation up to FY 2030–31.

The scheme translates Prime Minister Narendra Modi's vision, articulated from the Red Fort on Independence Day 2025, of a modern-day Samudra Manthan , the PIB press release said.

"It marks a landmark step towards strengthening India's energy security, accelerating domestic exploration and production, promoting technological leadership, and advancing the vision of Viksit Bharat," the press release added.

Key beneficiaries and stocks in focus

Oil & gas and offshore services stocks are likely to remain in focus. The five-year programme aims to accelerate offshore oil and gas exploration through seismic surveys, exploratory drilling and creation of supporting infrastructure, with the objective of increasing domestic hydrocarbon production and reducing India's dependence on energy imports.

• ONGC: India's largest upstream explorer is likely to benefit from higher offshore exploration spending, fresh exploration blocks, and increased domestic hydrocarbon production.
• Oil India: The PSU could gain from expanded offshore exploration opportunities as the government seeks to boost domestic oil and gas output.
• Reliance Industries (RIL): Through its exploration and production business, Reliance could benefit from increased offshore exploration activity and investments across the sector.
• Vedanta Oil & Gas: The newly listed upstream company is one of India's largest private crude oil producers. The government's push to accelerate offshore exploration could create long-term opportunities for expanding its exploration and production portfolio.
• Deep Industries: The company offers drilling, gas compression, and integrated oilfield services, positioning it to benefit from higher exploration and development activity.
• Dolphin Offshore Enterprises: As an offshore engineering and marine services provider, it could see increased demand for offshore support, subsea, and installation services as exploration projects gather pace.
• L&T: The engineering major could also be on investors' radar as its Hydrocarbon business executes offshore platforms, subsea infrastructure, and pipeline projects.

An increase in offshore exploration and subsequent field development could support future order inflows for the company.

Key details to know

The scheme encompasses a comprehensive set of interventions across the offshore exploration value chain.

It provides for large-scale acquisition, processing and interpretation of high-quality seismic data, accelerated deepwater and ultra-deepwater exploratory drilling, scientific drilling in frontier basins, development of common offshore production and evacuation infrastructure, and establishment of an integrated Oil & Gas Manufacturing and Services Zone.

It also includes dedicated provisions for digital programme management, capacity building, technology adoption, stakeholder engagement and international outreach, creating an integrated ecosystem to accelerate offshore exploration and production in the country.

The government said that Samudra Manthan is expected to catalyse reserve accretion of over 600 million metric tons of Oil Equivalent (MMTOE), substantially increase offshore exploration activity, promote higher domestic oil and gas production, generate large-scale employment, strengthen indigenous manufacturing under Make in India and Atmanirbhar Bharat.

Besides, it will foster a globally competitive ecosystem for offshore technologies and services.

The scheme is also expected to stimulate significant investments across the exploration and production value chain, creating long-term opportunities for industry, innovation and economic growth.

Where the money goes

The scheme's ₹84,084 crore outlay is weighted heavily toward the riskiest part of the exploration chain.

More than half - ₹43,200 crore - will be deployed over five years through 2031 specifically to support deepsea drilling, working out to roughly ₹650 crore for each of the 60 wells planned -- the clearest signal of the state's willingness to fund exploration risk directly rather than wait for the private sector to absorb it alone.

Beyond the wellhead, the government has set aside ₹10,000 crore to help fund the common infrastructure needed to move any discovered reserves into actual production -- pipelines, processing facilities and the like, without which even a successful discovery cannot reach the market.

Of the remainder, ₹28,534 crore has been allocated for offshore data acquisition, the seismic and geological surveying work that identifies promising basins before a single well is sunk, while ₹2,000 crore is earmarked for developing oil and gas manufacturing and services zones -- the industrial ecosystem needed to support a growing offshore sector.

Expert Take

Prashant Vashisht, Senior Vice President, ICRA Ltd, said the scheme provides funds for offshore seismic data acquisition especially in erstwhile No-Go zones, which is a key issue hampering commercial exploitation of oil and gas reserves in these areas due to lack of good prospectivity data.

"Additionally, the scheme provides support for drilling deepwater/ultra-deepwater wells where the domestic Upstream sector has limited experience and technical expertise and exploitation of the same remains highly capital intensive and risky. The scheme aims to add incremental annual production of 10-15 million tonnes of oil equivalent, which would reduce the dependence on imports of oil and gas but only to the extent of 3-5%, Vashisht said.