Page 4 - AsianOil Week 28

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India’s crude production shrinks 7% in May
PERFORMANCE
INDIA’S crude oil output fell by 7% year on year in May to 2.8 million tonnes (662,000 barrels per day) on the back of maturing production at state and privately operated elds.
Domestic production in the rst two months of nancial year 2019-2020 also shrank by 7% on the year, amounting to 5.52mn tonnes (663,000 bpd).
State-run Oil and Natural Gas Corp. (ONGC), the country’s largest oil producer, saw its production in May slip more than 4% to 1.76mn tonnes (416,000 bpd), while output in April-May contracted 5% to 3.45mn tonnes (415,000 bpd).
State-run Oil India Ltd (OIL) saw its output slide by 4% on the year to 274,000 tonnes (65,000 bpd), with two-month production also register- ing a 4% drop to 539,000 tonnes (65,000 bpd).
Crude production from privately operated projects as well as joint ventures with state com- panies fell by 13% year on year to 767,000 tonnes (181,000 bpd), undermined by operational issues and delays at Cairn Oil and Gas’ elds in Rajasthan State, according to the Ministry of Petroleum and Natural Gas. Production in
April-May slid 12% to 1.53mn tonnes (184,000 bpd).
e production dip in May is another in a long line of setbacks for the Indian government’s stated ambition of reducing the country’s import reliance. In March 2015, Prime Minister Naren- dra Modi said the country needed to reduce its oil import dependence from 77% in nancial year 2013-2014 to 67% by 2022. e country’s reliance on foreign crude supplies climbed to 85% in May, up from 83.8% in the same month of 2018.
New Delhi has urged its state developers to do more to stem the fallo in output and ONGC is now reportedly preparing to add an INR5bn ($72.8mn) exploration campaign in Gujarat State to its upstream agenda.
OGNC will drill 46 wells in 12 of its blocks in the Cambay Basin, Cogencis quoted an unnamed company o cial as saying on July 9.
e wells will be drilled to depth of 2,000- 3,000 metres and each is anticipated to take three to four months to drill. Government clearances are expected within a couple of months, at which point work will begin.™
250 230 210 190 170 150 130 110
90 70 50 30 10
2010-11 2011-12
2012-13 2013-14
2014-15
2015-16
Oil product consumption
2016-17
2017-18
Supply and Demand
™
2018-19
Data: PPAC
Crude/condensate production
IOC hires a foreign-flagged VLCC
PIPELINES & TRANSPORT
STATE-RUN re ner Indian Oil Corp. (IOC) has reportedly hired a foreign-owned very large crude carrier (VLCC) under a seven-year con- tract starting from January 2020.
e re ner had hired the Panama- agged Bright Pioneer tanker, which is owned by Japan’s Nissen Kaiun and operated by Singapore-based Global United Shipping, at a day rate of $31,950, e Hindu said on July 14.
e move comes despite government e orts to encourage the re ner to use local shipping
operators for its oil imports, a er domestic com- panies lobbied the government for an edge over their international rival. e Indian daily noted that local participants in the tender were allowed to match the lowest foreign quote.
Nevertheless, Indian shipping companies including state-run Shipping Corporation of India (SVI) refused to match Nissen Kaiun’s bid, arguing that the rate was “too low”.
Prevailing market rates, however, appear to con- tradict that position, with IOC understood to have
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