Why won't the majors explore? Fiscal terms, while improved, are still less competitive than Brazil, Guyana, or West Africa. The KG-D6 arbitration, with government claims against Reliance and bp approaching $30 billion, sends a message about contract sanctity. And India's frontier basins are genuine wildcats, lacking the accumulated well data that reduces uncertainty in mature provinces.

The comparison with Guyana is instructive precisely because it reveals both the opportunity and the difficulty.

In May 2015, ExxonMobil's deepwater drillship struck oil in the Stabroek Block offshore Guyana, a country of 800,000 people with no hydrocarbon history. More than 30 additional finds followed. By late 2025, Guyana was producing 900,000 barrels per day, with a trajectory toward 1.7 million bpd by 2030.

The Stabroek Block's 11 billion barrels of estimated recoverable resources have given a tiny South American nation the highest GDP growth rate on earth, an average of 47 per cent annually from 2022 to 2024.

Agarwal and others point to Guyana as proof of what frontier exploration can yield. India's sedimentary basin area is roughly 125 times larger than the Stabroek Block, and initial drilling in the ultra-deepwater Andaman Sea has established a petroleum system potentially analogous to producing basins in Myanmar and North Sumatra.

But the Guyana comparison also exposes what India lacks. ExxonMobil explored the Stabroek Block under a production-sharing agreement of extraordinary generosity: a 2 per cent royalty, a 50-50 profit split after cost recovery, and tax exemptions that make the effective government take among the lowest in the world. Those terms attracted the very company with the capability to find the resource. India's fiscal apparatus reflects a justified desire to capture fair value. But the trade-off is real: more demanding terms attract fewer world-class explorers.

There is a subtler lesson too. Guyana's success was the product of decades of prior geological work; Exxon's predecessors had explored the basin since the 1960s. India's frontier basins have had a fraction of that investment in basic data. The government's Mission Anveshan programme, launched in October 2024 with a ₹792 crore budget to survey seven basins, is a start, but modest relative to the unknowns.

The model Agarwal invokes most passionately, however, is not Guyana but the American shale revolution, and here the analogy is both more compelling and more problematic.

Two decades ago, the United States imported 60 per cent of its oil and was widely assumed to be in permanent decline. The transformation was achieved not by state-owned enterprises but by entrepreneurs, many of them small, stubborn, and willing to fail.

George P. Mitchell spent 17 years cracking the code for extracting gas from the Barnett Shale; the technology was rapidly adopted across the Bakken, Eagle Ford, and Permian basins. Today, roughly 9,000 independent producers operate 95 per cent of US wells and produce 85 per cent of its oil, more than 13.4 million barrels per day, more than any country in history.

Agarwal's vision of "thousands of drilling rigs" deliberately echoes this model. And there is a structural truth here: the US revolution happened because the regulatory environment rewarded risk-taking. Mineral rights belong to the landowner, not the state. Federal tax credits, fast permitting, deep capital markets, and a century of accumulated well data reduced barriers to entry.

India has virtually none of these enabling conditions. All subsurface mineral rights belong to the state, which means a farmer whose land sits above a promising formation has no financial stake in drilling; it is pure nuisance, threatening water tables and crops with no offsetting royalty.

In Texas, a landowner can grow wealthy from a productive well; in Tamil Nadu's Cauvery Delta, farmers have fought ONGC operations so fiercely that the state government declared the region a Protected Special Agricultural Zone, banning new exploration entirely.

Capital markets for upstream oil and gas are thin. Environmental clearances routinely take years. The number of active drilling rigs stands at roughly 51, compared to 551 in the US. India drilled 132 exploratory wells in FY2024; the US drills thousands annually.

The senior industry executive who worked on the Rewa basin prospect put the challenge in starkly practical terms: "Which Indian onshore sedimentary basin will accommodate these 'thousands of rigs'?" It is a question that proponents of the shale analogy have yet to answer.

Raghavan S Rao and Venu Gopal Narayanan

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