6 Months agoSPIEF comes closer! Tracing highlights from Indo-Russian collaboration in oil & gas.
This year, as India and Russia mark 70 years of diplomatic ties, India is Guest Country at the St Petersburg International Economic Forum (SPIEF) from June 1-3, 2017. In the run-up to SPIEF, we take a closer look at collaborations in the oil and gas sector.
INDO-RUSSIAN COLLABORATION IN OIL & GAS
The positive dynamics of the India-Russia partnership in the oil and gas sector and the growth potential these ties present cannot be over-emphasised. Expanding cooperation in the field of exploration, production, transportation, refining, storage, sale and use of oil & natural gas can be attributed to consistent efforts being made by both sides towards exploring newer avenues for investment.
The two countries have agreed to explore building the world's most expensive pipeline, costing close to USD 25 Billion with a probable length between 4,500 km to 6,000 km, to ferry natural gas from Siberia to India.
India is the third largest consumer of crude oil and petroleum products globally and the second largest refiner in Asia. India has 635 Million Metric Tonnes (MMT) of proven oil reserves, 54 Trillion Cubic Feet (TCF) of proven natural gas reserves and 96 TCF of estimated shale gas reserves.
With 48% of the country's sedimentary area yet to be explored, the oil and gas sector possesses tremendous growth opportunities.
A consortium led by Russian oil major Rosneft acquired India’s Essar Oil for USD 13 Billion. Indian companies Indian Oil Corporation Ltd, Oil India Limited and Bharat PetroResources Litd acquired equity in ‘Tass-Yuryakh Neftegazodobycha’ and ‘Vankorneft’, making it the largest equity oil acquisition ever by India. India’s ONGC Videsh and Russia’s Roseneft also inked an agreement to acquire a stake in Vankorneft: owner of Vankor Field and North Vankor license in Russia.
India’s Exploration and Production majors, Oil and Natural Gas Corporation and Oil India Limited are also eyeing stakes in oil and gas fields in Russia.
Russia is interested in attracting Indian oil companies to participate in joint projects in the offshore-Arctic fields of the Russian Federation.
The two sides are also working towards realisation of an ‘Energy Bridge’ through the construction of a gas pipeline for direct delivery of gas from Russia to India.
Engineers India Ltd and Gazprom, Russia’s energy giant recently signed an MoU on joint research of gas delivery routes to India. Further, from 2018, Gazprom has agreed to supply 2.5 MMT of liquefied natural gas annually to India.
Cementing the already well-established relations, the two sides signed the Programme of Cooperation (PoC) in the Field of Oil and Gas for the period 2017-18 at BRICS 2016.
The two countries support wider use of natural gas as an economically efficient and ecologically clean fuel to promote sustainable development, as well as to reduce greenhouse gas emissions in accordance with the Paris Agreement on climate change.
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