Government Interference in Oil & Gas Business:- By Ajay Kumar Fox Petroleum

Government Interference in Oil & Gas Business: Oil & Gas Business is the vital part of US Economy as well as many Countries in the world; But United States is very very open to private Oil & Gas Sector. It means less hindrance in the name of regulations, sanctions or approvals; That is why, there is no national oil and gas company in the United States. Instead, there are numerous businesses operating in the sector, including large international corporations. But, in many Countries government regulation do impact the oil & gas drilling sector - “on the basis of environmental issues including air and water quality regulation, offshore regulation and chemical management”.

The New Government in India is very conducive to support foreign investors in any sector; As, per the commitment made in public by the Honorable Prime Minister of India Shri Narendra Modi making impact in getting investment and positive response from the Governments and Private Companies across the globe; He made bigger statement in public and He is upto it – “Minimum Government, Maximum Governance”. It is a healing touch to wounded Industry Sectors to breath at ease with regulations and expand arms for development;

Like in India, The petroleum ministry has taken a bold step for reducing government interference in business by proposing a radical revision of the oil and gas exploration policy by reducing dependence on arbitrary government decisions and moving in favour of market signals. This can induce substantial changes in the fortunes of the sector by providing better incentives to investors, increasing competition among players and encouraging more investments and help reduce the country’s dependence on imports. India will move towards self-energy reliance; we welcome this step from the Government of India Ministry of Petroleum;

Even many Governments facing trouble to make tie-ups with Other Governments in the development of Oil & Gas Sector Business due to the policy made by the Government itselves; At the same time, it reflects in the private sector also making abroad tie-ups; So many Government-facing strategy problem for oil and gas companies: Developing a productive relationship with host governments; The old and established methods to government relations aren’t adequate for the new challenges that international oil companies face today. They must take a more systematic approach to government relations, which requires knowledge of the host country; a broad network of relationships; coordination with local sponsors; and an ability to plan, respond, and adapt to ongoing change.

We know that The United States is the land of the free, not the land of the federal. The United States has less interference in the Oil & Gas Sector in the past, but due to the Government interference, it is facing some challenges not many; The consequence is 7% down; Crude oil production in the United States has been increasing at remarkable rates since 2008. In 2013, the EIA found the United States produced 7.454 million barrels of crude oil per day, up from 4.999 million barrels per day in 2008. Production increases like this provide enormous economic benefits to producers and consumers alike. However, the new EIA report reveals the negative effects of federal interference on the oil, gas, and coal industries; WHEREAS Coal represents more than half of the conventional fuel energy extracted from federal lands, while natural gas and crude oil represent the remainder of the federal energy portfolio. The decline in oil, gas, and coal production on federal lands has caused the government’s share of total domestic conventional fuel production to fall to 25 percent.

WHEREAS in India, Industry cheers new petroleum exploration policy draft from the Government of India Ministry of Petroleum; It has given some sunshine to the energy sector of India; Industry players, including large domestic and foreign oil & gas explorers, have given a thumbs up to the government’s draft of the new petroleum exploration policy unveiled. The new regime is a big step forward and could bring in fresh investments of $50-60 billion in Indian Oil & Gas Sector in coming years; Thanks to this new Government Energy Policy and Investor Friendly approach;

To sum up, You eventually have to face up to the consequences of your actions. But for the rest, well I'm afraid you reap what you sow and the Board, the gloryhunters, the accountants and the marketing people can only stand by and hope that this doesn't mean the end. But I like to think you reap what you sow; You get the government you voted for, We have the best Government; Government of India – I voted for;