Oil India Announces Natural Gas Discovery in Andaman Offshore Block
State-owned Oil India Ltd has discovered natural gas in its offshore block in the Andaman and Nicobar Islands, a potentially significant development for India's energy security. The find was made in the second exploratory well drilled in the AN-OSHP-2018/1 block. While the commercial viability and size of the reserves are still under evaluation, the discovery confirms the presence of hydrocarbons in the Andaman basin, raising hopes for future exploration that could help reduce India's heavy reliance on imported gas.
Unpacked:
India relies heavily on imported gas, so finding domestic reserves could enhance energy security, reduce import bills, and support the government’s goal to boost domestic hydrocarbon production. The Andaman Basin is regarded as a frontier area with substantial undiscovered hydrocarbon potential, making this discovery particularly promising for future self-sufficiency.
Exploration began in 1959, with intermittent activity since then. Initial wells showed signs of gas but limited commercial success. Renewed interest followed policy reforms in 2016 (HELP), and recent years have seen increased seismic surveys and drilling, with the area now more accessible due to the opening of previously restricted ‘No-Go’ zones.
After a discovery, companies conduct further appraisal drilling and detailed technical studies to estimate the size, quality, and recoverability of the reserves. Commercial viability is determined based on the volume of recoverable gas, extraction costs, infrastructure needs, and market demand.
The Andaman basin is ecologically sensitive, and offshore drilling can pose risks to marine biodiversity. Geopolitically, the area is near international sea routes and close to Southeast Asia, making it strategically important. Regulatory oversight and environmental assessments are required to balance development with conservation.