Oil and Gas Market: Domestic Scenario

India-IEA Joint Emergency Response Exercise Workshop

Shri. L.N. Gupta, Joint Secretary (Refineries)
Ministry of Petroleum and Natural Gas, Government of India

30th May, 2012

Presentation Outline

Oil and Gas Market in India

1

Energy Overview

Upstream Sector

Downstream sector

Natural Gas Sector

Oil and Gas Market in India

1. Energy Overview of India

Indias Energy Facts at a Glance.

17.5% of worlds population (1.21 billion in year 2011)
3rd largest economy in the world by GDP (PPP basis IMF report)
GDP growth rate is expected to be in the range of 6.5-7.5%
11th largest Energy Producer in the world - Produces 2.4% of world production
6th highest in Energy Consumption - Consumes 3.3% of world consumption
Energy Consumption/capita amongst lowest in the world hence great growth
potential
One eight North Americas per capita energy Consumption
(Indias per capita consumption: Primary Energy 400 KGOE; Hydrocarbons 166)

One Sixth of western Europe Consumption and One fourth of the World
Average
Average
Consumption
Growth
has been 6%
p.a.,requirements
projected to increase
IndiaEnergy
imports
around 80% of
its hydrocarbon
energy
further

Securing energy sources is of very strategic importance to India

Primary Energy % Share

MMTOE

1995

2000

2005

2009

2010

Oil

75.2

106.1

120

151

156

Natural Gas

17.4

23.7

32

46

56

142.8

144.2

184

251

278

17.2

17.4

22

24

25

1.7

2.9
0.7

4
2

4
5

5
5

254

295

364

480

524

Coal
Hydro-Electricity
Nuclear Energy
Renewable
Total

Share of Coal as primary energy

source continues ..
Decline in share of Oil in % terms

Source statistical review of world energy 201

Growing Primary Energy Demand India

1633
MTOE

6%
=
R
CAG
510
MTOE

%
=7
R
AG
C
Gas
= 5%
R
G
CA
l
i
O

Estimated Demand for Primary Energy to rise up to 1633 MTOE by 2031-32

For oil, though importer for over 25 years, considering the dramatic rise in volume
demand, the balance of trade for oil is a critical issue
Source: BP Statistical Review 2011
Projected figure Source: Integrated Energy Policy

1.Oil and Gas Market in India

1.1 Upstream Sector of India

Upstream Sector: Key Facts

Key Facts
26 sedimentary basins: 3.14 mn sq kM (44% on

land and 56% offshore)

Prognosticated Hydrocarbon reserves: 28 BTOE

(<25% established) ~ 200 bn bbls

Crude oil production:38 MMT
Upstream NOCs dominate in

production/acreage
Directorate General of Hydrocarbons (DGH)

vested with upstream regulatory functions

New Exploration Licensing Policy (NELP)

Source: DGH

New Exploration Licensing Policy (NELP)

Exploration Blocks awarded in NELP Rounds

April 2000

Provides an international class fiscal and contract framework for E&P of hydrocarbons
Estimated sedimentary area of 3.14 lakh Sq. Kms
47% of estimated area has been awarded under first eight NELP
In the first eight rounds of NELP spanning 2000-2011, Production Sharing Contracts (PSCs)
for 235 exploration blocks have been signed.
Actual investment made by E&P companies under NELP is of the order of US$ 15.88 billion
Source: PPAC

Note: 9th NELP round has just now over

Significant Discoveries

Source:
DGH
Disc Yr:
2000-2005

Recent Discoveries

Source: DGH

Position of Hydrocarbon Reserves

Initial In Place

ONGC
OIL
Pvt./
JV
Total

Source: PPAC

Ultimate Reserves

Reserves* (MMT)

Oil

Gas

O+OEG

Oil

Gas

O+OEG

Oil

Gas

O+OEG

4960.66
776.09

2416.13
317.06

7376.79
1093.15

1403.25
230.06

1191.67
170.83

2594.92
400.89

552.61
81.79

659.38
100.81

1211.99
182.6

820.67

1208.70

2029.37

194.89

640.67

835.56

122.995

524.22

647.215

6557.42

3941.89

10499.31

1828.20

2003.17

3831.37

757.395

1284.41

2041.805

* Reserves denote balance recoverable reserves of hydrocarbons

Crude oil Production: Projection

Source: Report of the WG on P&NG Sector for the XII Plan

Alternate Source of HC: CBM and Shale Gas

Coal Bed Methane (CBM) Gas development in India
Prognosticated CBM Resources

92

TCF

8.92

TCF

Total available Coal bearing area

26000

Sq.KM

Exploration Initiated

17000

Sq.KM

33

Nos.

0.23

MMSCMD

Established CBM resources

Blocks Awarded*
Commercial production of CBM gas

*CBM blocks have been awarded in the state of Andhra Pradesh, Assam, Chattisgarh,
Gujarat, Jharkhand, Madhya Pradesh, Maharashtra, Orissa, Rajasthan, Tamilnadu and
West Bengal.

Shale Gas development in India

a) Shale Gas Spread in the sedimentary basins

Cambay, Gondwana, KrishnaGodavari onland and Cauvery

b) MoU signed on 06.10.2010 between Department of For the assessment of Shale Gas
State, USA and Ministry of Petroleum & Natural Gas Resources in India, imparting
training to Indian GeoScientists and Engineers &
assistance in formulation of
Regulatory Frameworks.

Source: Report of the WG on P&NG Sector for the XII Plan

Oil and Gas Market in India

2. Downstream Sector

Refinery Capacity: India

Third largest refining capacity in Asia-Pacific and fifth largest in the world
Indias Refinery Capacity additions have made the country surplus in products
Source: PPAC

Indian Refining Sector on Expansion Spree

Indias present refining capacity is 213 MMTPA (leapfrogged from 62 MMTPA in 1998)
Refining capacity is expected to touch 310.9 MMTPA by 2017
India is the largest exporter of petroleum product in Asia since Aug09 (Platts)

Maximization of distillates, Quality & Upgrading have been the major focus of Indian Refiners
Source: Report of the WG on P&NG Sector for the XII Plan
17

Projected Refining Capacity-PSU Vs. Private

Source: Report of the WG on P&NG Sector for the XII Plan

Finished Products: Production & Consumption

Figs in MMT

Figure of FY12 is provisional

Source: PPAC

Projected Products Demand: Sector-wise

Source: Report of the WG on P&NG Sector for the XII Plan

Projected Products Demand: Product-wise

Source: Report of the WG on P&NG Sector for the XII Plan

India Net Exporter of Petroleum Products

Figs in MMT

Indias rapid Refinery Capacity additions have made the country net exporter
of products (Largest exporter in Asia according to Platts)
Source: PPAC

Indias Marketing Network at a glance

As of 01.04.2011 (Prvnl.)

Retail Outlets
LPG Customers PSUs (Domestic and Non-domestic)

41,947
126.89 million

LPG Distributors- PSUs

10,541

Bottling Capacity (TMTPA)

11889

Auto LPG Dispensing Stations

222

Crude Oil Pipelines length (KM)

6559

Oil Product Pipelines length (KM)

12,783

Movement through Pipelines 2010-11 (MMT )

142

Gas Pipelines length (KM)

9774

Gas Pipeline movement in 2010-11 (MMSCMD)

170

Source: PPAC

US $ billion

Petroleum Products a major foreign exchange earner

Sector with immense Export Potential

Source: PPAC

Strategic Storage
Indian Strategic Petroleum Reserves Limited (ISPRL), a Special Purpose Vehicle
created by the Government of India, is currently building 5.33 MMT of crude oil
storage capacity . The storages are in underground rock caverns and the locations
and capacities are as follows:
Visakhapatnam, State of Andhra Pradesh.

Capacity: 1.33 MMT

Mangalore,

State of Karnataka.

Capacity: 1.5 MMT

Padur ,

State of Karnataka.

Capacity: 2.5 MMT.

As per the Integrated Energy Policy, the country is required to maintain a reserve of
strategic-cum- buffer stock equivalent to 90 days of oil imports.
OIL PSUs are also in the process of building storages for hydrocarbons. With these
storages the total storage of crude oil and petroleum products is expected to be
approx 30.82 MMT. As per a paper prepared by MoP&NG, the country would
require additional storage of 13.32 MMT by the year 2019-20. Of this, ISPRL is
conducting feasibility studies for 12.5 MMT of crude oil storage.
Source: ISPRL
25

Crude Pipelines
Number: 17
Length : 7425 km
Capacity:117 MMT

Product pipelines
Number: 28
Length :11000 km
Capacity:68 MMT

Source: PPAC
26

Oil and Gas Market in India

3. Natural Gas Sector

Indian Demand Assumptions

Figs in MMSCMD

The share of natural gas in the energy basket is projected to increase from 11% in 2010 to
around 20% by 2025.
Source: Report of the WG on P&NG Sector for the XII Plan

Natural Gas Availability: Projections

Figs in MMSCMD

Gas availability is projected to be increase by 2.5 times to 500 mmscmd in next five years

Source: Report of the WG on P&NG Sector for the XII Plan

LNG Import Facilities: Projections

Figs in MMSCMD

LNG import facility is projected to increased from 20 to 45 mmscmd in next five years
Source: Report of the WG on P&NG Sector for the XII Plan

Gas Pipeline Network

Gas Pipelines in India:
Pipeline Length
13428 KM
Design Capacity
355 MMSCMD
Average Flow
232 MMSCMD

Source: PPAC
31