RAM NAIK HIGHLIGHTS INVESTMENT OPPORTUNITIES
IN INDIAN OIL SECTOR
INVESTMENT OF USD 78
BILLION REQUIRED IN REFINING AND MARKETING INFRASTRUCTURE TO MATCH
DEMAND BY 2025 - NAIK
CALLS UPON OPEC TO
ENHANCE PRODUCTION
Petroleum Minister, Shri Ram Naik
while highlighting the opportunities in the Indian hydrocarbon
sector, invited multi-national oil companies to make investments
in India. Shri Naik was speaking today as panelist at the second
session of "Facilitating Investments in Energy Sector" of the
International Energy Forum being held at Osaka, Japan. The session
was chaired by Mr. Obaid bin Saif Al Nasseri, Oil Minister of
United Arab Emirates and had panelists from Norway, Venezuela,
Qatar, Republic of Korea and India.
The Minister informed that estimated
investment requirements upto the year 2025 are about USD 51 billion
in refining sector and USD 27.55 billion in the marketing sectors.
He made a call to all interested countries and companies to participate
in the expanding oil industry in India. To foster competition
in the domestic petroleum sector of India, the Administered Pricing
Mechanism has been dismantled from 1st April, 2002
and any company can obtain marketing rights in India if it commits
to spend USD 400 million for development of hydrocarbon infrastructure
over the next 10 years. The present requirement of petroleum products
in India of about 100 million tonnes per annum (MMTPA) is expected
to increase to over 140 MMTPA by 2006-2007 and would require oil
refining capacity of around 155 MMTPA i.e. an additional 40 MMTPA
over the present capacity. This would further reach a level of
over 350 MMTPA (7 million barrels per day) by 2024-2025.
Shri Naik highlighted the thrust
to oil exploration in the country through the New Exploration
Licensing Policy (NLEP) and the completion of 3 successful round
under NLEP. The foray into energy substitutes through award of
blocks for Coal Bed Methane production was also mentioned. He
also spoke about potentials for investment in natural gas sector
where 50 per cent of country’s requirement is being met from indigenously
produced gas. A number of Liquefied Natural Gas (LNG) projects
are being pursued by private and public sector companies. To facilitate
investments, the Government has put LNG and gas imports on Open
General License. The investment opportunities in the gas sector
comprise the entire chain of LNG terminals, cross border pipelines,
distribution and marketing etc.
He spoke at length about the conducive
climate created by the Government of India for overall growth
of the energy industry. The Hydrocarbon Vision 2025 lays the road
map for energy industry developments in India upto the year 2025.
Speaking at the session, Shri Ram
Naik elaborated on the need for curbing speculative activities
by enhancing supplies and building inventories to healthy levels.
He stated that high oil prices support investments in un-economic
fields in deficit countries to the detriment of the oil producers,
which is evidenced by the fact that 1.8 million barrels per day
of oil was produced by non-OPEC countries between 1998 and 2001
when the OPEC scaled down its production by about 5 million barrels
per day.
Talking about investments in the
petroleum sector, he stressed the need for technologies that ensure
sustainable production of energy in harmony with the investment.
He pointed out that the challenges are to develop cost effective
technologies to cut costs in the upstream sector and in the downstream
sector for producing high quality fuels that minimize emissions
into the environment.
