State-owned Oil India Ltd (OIL) has discovered natural gas in a shallow-water offshore block in the Krishna-Godavari Basin, with tests recording a peak flow of 200,000 standard cubic metres per day (SCMD). The well also produced condensate.

The discovery was made at the Godavari-1 appraisal well in the KG-DSF/GSKW/2018 block, secured through the Discovered Small Field (DSF) bidding process. The gas was found in the previously unappraised Matsyapuri formation.

Oil India began testing the hydrocarbon-bearing zone on October 16, 2026, at a depth of 2,024 to 2,027 metres. The well produced around 100,000 SCMD of natural gas during continuous testing, with a peak flow reaching 200,000 SCMD. Condensate production stood at approximately 170 barrels per day.

The company plans to test the next higher zone to assess the discovery further. However, it has not released estimates of the available hydrocarbon resources or provided a timeline for potential commercial production.

Oil India shares were trading at ₹447.50 on the BSE at 12.34 pm on Friday, down 1.69%.

The Krishna-Godavari Basin, located along India's eastern coast, is an important offshore hydrocarbon-producing region. Exploration in the basin supports efforts to increase domestic natural gas production and develop indigenous energy resources.

India relies on imports for a substantial share of its natural gas requirements. The government aims to raise natural gas's share in the country's energy mix to 15% by 2030, from around 6% currently, making the development of indigenous resources an important step for India’s energy self-reliance framework.