- The Ministry of Petroleum and Natural Gas issued a notification on May 8, 2026, regarding new royalty rates for the production of crude oil and natural gas.
- This new framework will be applicable to the country's onshore, offshore, deepwater, and ultra-deepwater fields.
- The objective of this initiative is to boost domestic oil and gas production and to attract investment into the energy sector.
- Royalty is a statutory levy paid to the government in exchange for the exploitation of natural resources.
- In the oil and gas industry, this payment is typically determined based on the volume of production or the well-head price.
- Well-head price refers to the price realized at the production site, excluding transportation and marketing costs.
- Through this system, the government generates revenue from natural resources and maintains transparency within the energy sector.
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