<p>Understanding the depositional environment is essential for evaluating hydrocarbon generation potential. This study examines the Lower Permian Barakar Formation in the Auranga Basin, part of the Damodar Valley within the Gondwana succession, by integrating geochemical and palynofacies analyses to reconstruct palaeodepositional conditions and assess organic matter preservation. 38 shale samples were analyzed for bulk δ¹³C (– 25.05 to – 21.76‰) and δ¹⁵N (– 2.98 to 2.55‰), indicating a predominant contribution from C₃ plants. Total Organic Carbon (TOC) content (average 14.65 wt%) and Total Nitrogen (average 0.29 wt%) suggest a high organic content with variable preservation potential. Palynofacies analysis and redox-sensitive trace element ratios (U/Th, Ni/Co, V/Cr) indicate deposition in a suboxic to oxic palaeomire, influenced by freshwater conditions with limited brackish water influence (Sr/Ba, Sr/Cu). The presence of swampy conditions alongside fluvial depositional features, such as point bars and meandering channels, suggests a dynamic sedimentary environment. These findings suggest limited hydrocarbon generation potential in the basin. Notably, the study reveals for the first time that terrestrial-dominated organic matter, when deposited under persistently oxic conditions, underwent extensive degradation and poor preservation, which directly constrained hydrocarbon generation. This explicit linkage between organic matter source, redox state, and sedimentary processes in a continental rift setting provides a novel framework for evaluating exploration risk in Gondwana basins and analogous depositional systems.</p>