Coalbed Methane (CBM), an unconventional source of natural gas is now considered as an alternative source for augmenting India’s energy resource. India has the fifth largest proven coal reserves in the world and thus holds significant prospects for exploration and exploitation of CBM. The prognosticated CBM resources in the country are about 92 TCF (2600 BCM) in 12 states of India. In order to harness CBM potential in the country, the Government of India formulated CBM policy in 1997 wherein CBM being Natural Gas is explored and exploited under the provisions of OIL Fields (Regulation & Development) Act 1948 (ORD Act 1948) and Petroleum & Natural Gas Rules 1959 (P&NG Rules 1959) administered by Ministry of Petroleum & Natural Gas (MOP&NG).
Refining for the World
Fourth largest LNG importer after Japan, South Korea and China, India accounts for 7.4% of the total global trade.
The country has become world’s fastest growing energy market.
India is the 3rd largest energy consumer and oil consumer in the world after China and USA. Oil & gas accounted for around 35 % share in India’s energy consumption.
Import of Crude oil during Apr-Nov, 2016 was 143.8 MMT (USD 45.4 bn), an increase of 9.3% over FY 15-16. Imports of petroleum products during Apr-Nov, 2016 was 24.6 MMT (USD. 6.6 bn), an increase of 29.3% over the last year.
- The demand for petroleum products is estimated to reach 244,960 MT by 2021-22
- Focus to reduce Oil and Gas imports dependence from 77 % to 67% by the year 2022
- Gas production will likely touch 90 bn cubic meter by 2040
100% FDI allowed in exploration activities of oil and natural gas fields under automatic route
49% FDI allowed in petroleum refining by the Public Sector Undertakings (PSU), without any disinvestment or dilution of domestic equity in the existing PSUs under automatic route
Fore more details, FDI Policy 2017
- Largest exporter of petroleum products in Asia
- Second largest refiner in Asia
- Third largest consumer of crude oil and petroleum products in the world
India has emerged as a refinery hub.
India's current refining capacity stands at 230.1 MMPTA, comprising of 23 refineries. Indian Oil Corporation (IOC) emerged as the largest domestic refiner with a capacity of 69.2 MMTPA.
Top three companies - RIL, IOC and BPCL - contribute around 65.5% of India's total refining capacity while HPCL & CPCL contributes 6.7% & 5.1% respectively.
Consumption of petroleum products in India stood at 184.7 MMT in FY15-16, 194.6 MMT in FY16-17 and 98.6 MMT in 2017 (April to September). Moreover, during FY17, the production of petroleum products by fractionators was 3,458 ('000) MT.
The production of crude oil was 36.9 MMT during FY15-16 which is expected to reach 37.08 MMT in FY16-17. The production of petroleum products was 231.9 MMT during FY15-16 which is expected to reach 238.07 during FY16-17.
- Global LNG Imports share
- Oil consumption CAGR (2008-17)
- Gas consumption CAGR (2007-16)
- LPG sales growth (2016-17)
FDI in petroleum & natural gas
FDI share w.r.t. total FDI received in India
FDI allowed under automatic route in Petroleum refining by PSU, without disinvestment of dilution of domestic equity in existing PSUs
FDI is allowed in exploration activities of oil and natural gas fields, infrastructure related to marketing of petroleum products and natural gas, marketing of natural gas and petroleum products, petroleum product pipelines, natural gas/pipelines, LNG Regasification infrastructure, market study and formulation and Petroleum refining in the private sector, under automatic route
October 2017 - India is likely to attract investments worth over USD 40 bn in the next five years in the oil and gas sector alone as several global oil companies like Saudi Aramco, BP Plc., Vedanta Resources and Total of France have shown interest in investing in world's fastest growing market
July 2017 - Royal Dutch Shell Plc, which has already invested USD 1 bn in India, has planned further investments in upstream and downstream segments of oil and gas sector, and is also doubling its employee base at its Shell Technology Centre Bangalore (STCB)
August 2016 - Norwegian chemical company Yara International ASA has entered into an agreement to acquire the Tata Chemicals Ltd’s Babrala urea plant and distribution business in Uttar Pradesh for USD 400 mn on a debt and cash free basis, including normalised net working capital.
January 2016 - Petrogas Pvt Ltd, a joint venture of Isomeric Holdings bhd of Malaysia and LEPL Venture Pvt Ltd of India, will collaborate with Krishnapatnam Port Co Ltd and the Government of Andhra Pradesh, to set up a Liquefied Natural Gas (LNG) regasification and floating storage terminal at Krishnapatnam Port in Nellore district with an investment of around USD 447.3 mn.