Page 5 - AsianOil Week 31
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“Companies always look at areas where they have expertise. 20 years of working in Indian sedimentary basins have given us enough knowledge and understanding,” he said. “Ask ONGC or other partners, we are a good operator. So actually, we are pretty well placed.”
Thomson added: “Such is our reputation abroad that we can bring new international part- ners [into India]. We can act as a catalyst. ere is a lot to do, as India has huge unexplored and under-explored areas.”
omson’s mention of the company’s inter- national connections will not go unnoticed by the government. New Delhi is keen to attract foreign expertise to help it squeeze more oil and gas from its ageing elds and help deliver much needed new discoveries.
Performance
Crude output fell by 6.8% year on year to 8.2mn tonnes (661,000 bpd) in the rst quarter of nan- cial 2019-2020, while gas production slipped 0.5% to 8.03bn cubic metres (bcm).
As a result, India’s oil import dependence climbed from 83.8% in April-June 2018 to 85.2% in the most recent quarter. Gas import depend- ence increased from 48.7% to 50.4%. e coun- try is projected to spend INR8tn ($112.8bn) on oil imports in 2019-20, according to Ministry of Petroleum and Natural Gas estimates that assume an oil price of $66 per barrel and an aver- age exchange rate of INR71 to the dollar.
is is far from good news for Indian Prime Minister Narendra Modi’s government, which set a target of cutting oil import dependence by 10% from 77% in early 2015.
Image: Cairn India
India, however, is continuing to reform its upstream laws in an e ort to address its pro- duction problem. New Delhi earlier this year said that gas producers would be given pricing and marketing freedom for all new discoveries and state-owned developers would be allowed to work with private players to enhance exist- ing blocks with new technology, capital and expertise. Bidding rules for new elds will also incorporate elements of both revenue and pro- duction-sharing contracts (RSC/PSCs).
e fact remains that very few foreign com- panies have shown much interest in the coun- try’s bid rounds and existing players continue to dominate the bidding landscape. India’s rep- utation for bureaucracy continues to haunt its e orts to attract large foreign developers.
Still, the investment landscape is improv- ing. e country climbed 23 spots in the World Bank’s 2019 Doing Business Report (DBR) to 77th place among 190 countries assessed.
e government is clearly making the right moves if it has managed to attract Cairn Energy’s interest, given the bad blood between the two. But hurdles remain before the country is likely to see the in ux of foreign investment necessary to deliver major new oil and gas nds. It could be years before the country sees the bene ts from the changes it is making now.
Week 31 07•August•2019
w w w . N E W S B A S E . c o m P5
