India is moving into position to be the biggest driver of global oil demand growth, and it is seeking new investment in its own energy industry.
India's energy minister announced a new round of bidding for upstream and downstream investments on Monday. "We want to increase our production. We want to invite investment," said Shri Dharmendra Pradhan, the country's minister of petroleum and natural gas, speaking at the annual CERAWeek by IHS Markit conference in Houston. "I must tell you there was never a better time to be in India. I encourage both existing and new players to come forward and avail the opportunity," he said in prepared remarks.
Just before the minister addressed media, Fatih Birol, International Energy Agency executive director, told reporters that India and China would be responsible for about half of oil demand growth. He said India has just become first in oil demand growth, but not yet natural gas.
"India is the third-largest oil consumer in the world, which is a clear indication of the importance of petroleum products in our daily lives," Pradhan said. "Also, according to the International Energy Agency, we are likely to contribute the most to the rise in global energy demand over the coming decades."
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Pradhan said India's focus will be on four pillars, based on Prime Minister Narendra Modi's goals:
- Providing affordable energy to consumers by developing oil infrastructure and expanding the natural gas grid network.
- Achieving energy sufficiency by increasing capital investment in rails and waterways.
- Achieving energy sustainability with increased production of renewable energy and cleaner fuels.
- Achieving energy security through increased upstream production and overseas acquisitions.
Pradhan said the government is also contemplating a policy for enhancing production of mature fields currently being operated by national oil companies. It hopes to encourage partners to bring in state-of-the-art exploration and production technologies.
The latest bidding round is being unveiled with much fanfare at CERAWeek as part of India's new Hydrocarbon Exploration Licensing Policy. India is hosting a major dinner where a number of officials will speak.
The new program follows on the bidding of the Discovered Small Fields, which Pradhan had brought to Houston in a roadshow last July. He said that went well with 31 of 46 contract areas being allocated even with low oil prices.
"We are looking at investments in technology given that we are present here in Houston, a city known for its capital intensive and technical know-how," he said in prepared remarks.