Dr N Janbemo Humtsoe
Wokha
The Tripartite Agreement signed on 11 June 2026 between the Government of India and the state governments of Assam and Nagaland marks a historic shift in the approach to the exploration of oil and gas along the Assam- Nagaland boundary, popularly known as the Disturbed Area Belt (DAB). Although the agreement avoids using the term “Disturbed Area Belt” or disclosing the specifics of the revenue-sharing formula; it establishes a framework to facilitate oil exploration and production in the identified “Areas of Interest.”
The Tripartite Agreement is, in many ways, a significant political achievement for both Assam and Nagaland, reflecting years of engagement on revenue sharing in the disputed border region. Since 1988-89, the government of Nagaland has been raising the issue of revenue sharing from the oil that is produced from the DAB with the Union Government. Therefore, the agreement signifies the culmination of a demand that dates back to nearly four decades.
It is worth noting that petroleum and natural gas exploration in Nagaland began as early as 1963, albeit without a Petroleum Exploration License (PEL). Oil was first struck at the CN-1 in 1973, following which the Government of Nagaland issued a Petroleum Exploration License on 20 November 1973. The same well, CN-1, was formally inaugurated on 20 December 1973 by the then Minister for Geology and Mining, Late JB Jasokie. Commercial production commenced on 28 March 1981without obtaining a Petroleum Mining Lease (PML). However, oil production soon became a source of contention, facing repeated protests due to concerns regarding lack of transparency, inadequate disclosure, and the lack of a fair mechanism for benefit and revenue sharing with the State and the affected local communities. Finally, the state government stopped the ONGC from all further exploration operations in Dimapur, Bhandari and Changpang-Tssori area on 5th May 1994.
However, oil exploration activities continued unhindered on the Assam side of the border. A visit to the present Assam-Nagaland border in the Changpang-Tssori area reveals numerous exploration activities on the Assam side; some located only several meters away from the abandoned oil rigs in Nagaland. While commercial extraction continued uninterrupted on the Assam side, petroleum activities in Nagaland remained dormant for decades due to political and administrative uncertainties.
This gave rise to two major concerns in Nagaland. First, given the close proximity of oil wells on either side of the border, local communities have long expressed apprehension that sustained extraction from the Assam side could influence the dynamics of the shared underground petroleum reservoir, potentially affecting hydrocarbon reserves on the Nagaland side. Although such apprehensions can only be confirmed through detailed geological studies.
Secondly, the issue extends beyond petroleum development to the broader historical dispute over the Assam - Nagaland boundary. Nagas has not accepted the present interstate boundary as the traditional border between the Nagas and the Ahoms. According to the historical narrative, the foothill forests known as the Naga Hills Reserve Forest had no human habitation, until the British gradually push for tea cultivation in these reserve areas in the 1860s. Following the British withdrawal in 1947, large portions of this reserve area were placed under the administrative control of the then Sibsagar and Nowgong districts of Assam. Thereafter, Assam government started to move people to live in these contested lands.
The transfer of these Naga Hills Reserve Forest was strongly opposed by the Nagas and these concerns were mentioned in both the Nine-Point Agreement (Naga- Akbar Hydari Agreement) of 1947 and the Sixteen-Point Agreement of 1960. Point six of the 9-point agreement reads “That present administrative divisions should be modified so as to bring back into the Naga Hills District all the forests transferred to the Sibsagar and Nowgong Districts in the past.”
According to available government records, as of 2009, ONGC had drilled 23 wells in the DAB, of which 13 were oil-bearing. These wells were producing approximately 161 cubic metres of crude oil per day, and the cumulative production stood at 0.8 million metric tonnes (MMT). Converted into industry standard units, this is equivalent to roughly 1,013 barrels of oil per day (bpd) and a cumulative production of approximately 5.9 million barrels of crude oil. Furthermore, according to a statement made by MLA Y. Mhonbemo Humtsoe in the Nagaland Legislative Assembly in August 2024, 657,432 metric tonnes of crude oil (equivalent to approximately 4.9 million barrels) were extracted from the Disputed Area Belt (DAB) during the period 2018–2022.
Despite substantial oil production from the Disputed Area Belt over several decades, the Government of Nagaland has not received any revenue generated from petroleum extracted in the contested area. The Tripartite Agreement is therefore significant because it acknowledges and recognise Nagaland’s claim to a share of the revenue arising from oil production within the disputed zone.
As Nagaland prepares to resume oil exploration after decades of uncertainty, the state now stands at a crossroads to unlock its petroleum potential, and at the same time to chart a new path for economic development. For a resource poor state like Nagaland, the responsible development the petroleum sector could provide much needed fiscal support for economic development. However, this opportunity must not come at the expense of repeating the mistakes of the past. The lessons from earlier exploration activities underscore the need for a transparent, inclusive, and accountable framework governing every stage of the process- from land acquisition, compensation, environmental safeguards, and benefits sharing to the production stage.
At the same time, it is important to recognize that oil money alone cannot guarantee sustainable and inclusive development. Assam, India’s oldest oil-producing state, has extracted crude oil for over a century, since the British era, and has earned huge revenues from the sector. While oil has undoubtedly contributed to Assam’s economic growth, other NE states like Sikkim and Mizoram, both of which are non-oil producing state, perform much better on key human development indicators. This demonstrate that natural resource wealth must be accompanied by sound governance, prudent fiscal management, investments in human capital, and equitable distribution of benefits. Ultimately, the true measure of success will not be the number of barrels extracted or the revenue generated, but whether these resources are transformed into lasting improvements in the lives of the people.
