New Delhi: India will build a new 9 million tonne refinery in Rajasthan, auction more fields with oil and gas discoveries and has started talks with Saudi Arabian Oil Co. (Saudi Aramco) for investments in India as part of efforts to improve energy security, oil minister Dharmendra Pradhan said.
Addressing the global natural resources conclave organised by Network18 and industry chamber Confederation of Indian Industry (CII), Pradhan assured industry executives that the government will not interfere in the marketing and pricing freedom of companies under the new licensing regime as the priority is to cut down import dependence in hydrocarbons by 10 percentage points by 2022. At present, 70-75% of the oil requirement is met through imports.
The idea is to enhance the area under exploration as well as the capacity for refining crude, both domestic and imported.
Saudi Aramco is being consulted for participation in a 60 million tonne mega refinery planned in Maharashtra.
The proposed $30 billion project is being executed as a joint venture by India’s largest refiner Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp.
For the new 9 million tonne refinery in Rajasthan, Hindustan Petroleum Corp. will partner with the state government under terms which are beneficial for both.
Financial assessment of the project is over, explained Pradhan.
India, which currently consumes 185 million tonnes of petroleum products on an annual basis, wants to augment supply of auto fuel, liquified petroleum gas (LPG) for cooking and petrochemicals for various downstream industries. State-owned fuel retailers increased the number of LPG connections in the coutnry from 140 million in 2014 to 200 million now.
Vedanta Resources chairman Anil Agarwal, who was present on the occasion, said group company Cairn India Ltd, which is producing oil from Rajasthan, was working towards doubling its output.
“We are working on augmenting output to 50% of the country’s total production,” Agarwal said, adding the group will bid for oil and gas fields with discoveries when auction is held.
Pradhan said that simultaneously, the country’s fuel mix is being expanded with an emphasis on gas.
The oil, power and railway ministries are working on importing liquefied natural gas (LNG) for long haul rail transportation, he said.
India wants to add more sources of fuel supply as demand is projected to jump significantly.
According to the International Energy Agency’s India Energy Outlook 2015, the country is set to contribute more than any other country to the rise in global energy demand over the next 25 years.
The report said that India needs more than Rs9 trillion ($140 billion) in energy investment per year to 2040.