New Delhi, October 19, 2026: State-owned Oil India Limited (OIL) has signed a revenue-sharing contract for a 272.14-square-kilometre coal bed methane (CBM) block in the Singrauli Coalfield region, marking what the company describes as its return to exploring natural gas associated with coal deposits.
The agreement for Special CBM Block SR-ONHP-(CBM)-2026/1 was signed on October 15, 2026, according to a company announcement submitted to the National Stock Exchange and BSE on October 18.
Coal bed methane is a form of natural gas found in coal seams. Exploring such resources can help identify potential sources of domestic gas, although commercial production depends on the discovery of economically recoverable reserves.
According to Oil India, the Singrauli block covers 272.14 square kilometres and has promising geological characteristics, with coal seams expected at depths of 600 to 800 metres and an average thickness of approximately 40 metres.
These measurements describe the block’s expected geological characteristics rather than confirmed methane reserves. The company has not disclosed estimates of recoverable gas, expected production volumes or the resource’s potential commercial value.
The contract-signing ceremony was attended by Union Minister for Petroleum and Natural Gas Hardeep Singh Puri, Petroleum Secretary Neeraj Mittal and Director General of Hydrocarbons V. Ponnuraj.
Oil India was represented by its Director (Operations), Trailukya Borgohain, and other company officials.
The company did not disclose the agreement’s financial terms, planned investment or exploration timetable.
Oil India described the agreement as an important milestone in its strategy to diversify its energy operations and expand its involvement in unconventional hydrocarbon exploration.
Unlike conventional natural gas deposits, coal bed methane is associated with coal-bearing geological formations. Determining whether such deposits can support commercial production requires exploration and assessment of the available gas resources.
According to Oil India, the agreement represents its return to CBM exploration and supports its broader objective of developing India’s unconventional hydrocarbon potential.
The company linked the initiative to its efforts to strengthen domestic energy security by exploring additional sources of natural gas.
However, the announcement does not confirm the discovery of commercially recoverable methane reserves or indicate that drilling or gas production has begun at the Singrauli block.
It also does not specify when exploration activities will commence or whether the block will eventually support commercial gas production.
The agreement therefore marks a contractual milestone in Oil India’s coal bed methane exploration activities rather than the commencement of gas extraction.
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