Union Petroleum Minister Hardeep Singh Puri announced on Thursday, 11 June 2026 that Nagaland will resume oil and gas production after 31 years, following the signing of a tripartite Memorandum of Understanding between the Ministry of Petroleum and Natural Gas, Nagaland, and Assam — a development he described as opening a new basin for fresh wildcat exploration under PM Narendra Modi's leadership.

Context

Puri declared that the North East 'gave birth to India's petroleum industry' and now 'stands ready to power the next chapter of India's energy journey.' The tripartite MoU was signed in the presence of Union Home Minister Amit Shah, lending significant political weight to the agreement. The pact creates a framework for cooperation between the three parties to enable long-term investment decisions in hydrocarbon exploration and production.

Nagaland Chief Minister Neiphiu Rio and Assam Chief Minister Himanta Biswa Sarma were credited by Puri for rising 'above differences to chart the way forward for the region and the country.' The minister expressed gratitude to both state leaders for their role in bringing the agreement to fruition.

Policy Backdrop

Assam alone accounts for nearly 22% of India's crude oil reserves and around 15% of the country's natural gas reserves. Nagaland possesses significant hydrocarbon potential in the Naga-Schuppen Belt of the Assam-Arakan Basin — a geologically prospective zone with large untapped resources where hydrocarbons are known to occur naturally.

The North East's petroleum legacy stretches back to the 1889 Digboi discovery in Assam, which marked the beginning of India's commercial oil industry. Subsequent policy frameworks, including the Hydrocarbon Vision 2030 for the North East unveiled in 2016 and the Hydrocarbon Exploration and Licensing Policy (HELP) introduced the same year, laid the groundwork for expanding frontier exploration in the region. The HELP regime replaced earlier licensing systems with uniform terms designed to attract fresh investment in underexplored basins.

India imports the bulk of its crude oil requirements, making domestic exploration a strategic priority. The Ministry of Petroleum and Natural Gas has pursued expanded exploration under the Open Acreage Licensing Policy (OALP) bidding rounds, with frontier basins in the North East among the key targets for new wildcat drilling.

Stakeholders and Impact

Puri outlined a broad range of expected benefits from the resumption of mineral oil operations in Nagaland. These include direct and indirect employment generation, stimulus for local entrepreneurship, strengthening of physical infrastructure, and opportunities for contractors, service providers, and small businesses in surrounding communities across the North East Region.

The MoU is designed to provide 'certainty to investors, facilitate operational continuity, enable regulatory coordination and create conditions necessary for long-term investment decisions,' according to Puri's post. Oil exploration companies, including state-run entities such as Oil India Limited and ONGC, which have historically operated in the Assam basin, are among the primary stakeholders who stand to benefit from the inter-state coordination framework.

Local communities in both Nagaland and Assam are expected to see economic activity generated by resumed exploration and eventual production, with the minister emphasising the agreement's potential to contribute 'significantly to the economic development of surrounding communities and the entire NE Region.'

What's Next

The immediate focus will be on translating the MoU into operational reality — specifically, the grant of wildcat drilling permits and the inclusion of Nagaland blocks in future OALP bidding rounds. Progress on these fronts will determine how quickly the renewed exploration framework moves from policy commitment to on-ground activity.

The broader implication is significant: if the Naga-Schuppen Belt yields commercial discoveries, it could materially alter the North East's contribution to India's domestic hydrocarbon output and reduce the country's dependence on crude imports — a central goal of the Modi government's energy security agenda.