• India’s energy demand is expected to double to 1,464 Mtoe by 2035 from 559 Mtoe in World’s fourth-largest 2011. Moreover, the country’s share in global primary energy consumption would increase energy consumer twofold by 2035 Fourth-largest • Oil consumption is estimated to reach 4.0 mbpd by FY16, expanding at a CAGR of 3.2 per consumer of oil and cent during FY08–FY16F petroleum products Sixth-largest LNG • LNG imports accounted for about one-fourth of total gas demand. India's gas demand is importer in 2011 estimated to more than double over the next five years Source: US Energy Information Administration (EIA); Ministry of Petroleum & Natural Gas; Aranca Research Notes: Mtoe – Million Tonnes of Oil Equivalent; mbpd – Million Barrels Per Day FY08 GrowingGrowing demand demand Skilled workforce FY16F • India is the world’s fourth-largest • About 139,068 people were Oil energy consumer; oil and gas employed in the petroleum Oil demand: account for 37.3 per cent of total industry at the end of FY12 demand: 3.1 mbpd; energy consumption 4.0 mbpd; Gas • The University of Petroleum and Gas demand: • Buoyant economic growth is the Energy Studies in Dehradun, demand: 31.5 bcm main factor driving the country’s Uttarakhand, is Asia’s first and 165.2 bcm energy requirements only energy university Advantage India Supportive FDI guidelines Policy support • The engineering sector is delicensed; • 100 per cent Foreign Direct • Government100 per cent FDI has is enactedallowed invarious the Investment (FDI) is allowed in policiessector such as the New upstream and private sector Exploration Licensing Policy (NELP) refining projects • andDue toCoal policy Bed support, Methane there (CBM) was policycumulative to encourage FDI of USD14.0 investments billion into • The FDI limit for public sector acrossthe sector the over industry’s April 2000 value – February chain refining projects has been raised 2012, making up 8.6 per cent of total to 49 per cent FDI into the country in that period Source: Business Monitor International (BMI); World Oil Outlook 2012; Ministry of Petroleum & Natural Gas; Aranca Research Notes: mbpd – Million Barrels Per Day; bcm – Billion Cubic Meters India is the world’s fourth-largest energy consumer The country has 5.6 billion barrels of proven oil reserves, with an average oil production of 0.8 mbpd (2012) India has 1,330 bcm of gas reserves and produced 47.6 bcm of gas in 2012 Upstream • The upstream segment is dominated by the state-owned ONGC segment - • It is the largest upstream company in the exploration and production (E&P) Exploration and segment, accounting for approximately 62 per cent of the country’s total oil production output Midstream • IOCL operates a 11,163 km network of crude, gas and product pipelines, Indian oil and gas segment – with a capacity of 1.6 mbpd sector Storage and transportation • This is around 30 per cent of the nation’s total pipeline network Downstream • IOCL is the largest company, operating 10 out of 22 Indian refineries segment – Refining, • Reliance launched India’s first privately owned refinery in 1999 and has processing and gained a considerable market share (28 per cent) marketing Source: BP Statistical Review, June 2012; Ministry of Petroleum & Natural Gas; Aranca Research Notes: bcm – Billion Cubic Meters; mbpd – Million Barrels Per Day; ONGC – Oil & Natural Gas Corporation of India; IOCL – Indian Oil Corporation Ltd Oil consumption is estimated to expand at a CAGR of 3.4 Oil consumption in India and current reserves per cent during FY2008–16F to 4.0 mbpd by 2016 5.0 6,000 4.3 4.1 Owing to this strong expected growth in demand, India’s 3.9 3.5 3.9 4.0 4.0 3.7 dependency on oil imports is expected to increase further 5,700 3.1 3.2 3.0 5,400 2.0 5,100 1.0 0.0 4,800 FY08 FY09 FY10 FY11 FY12* FY13F FY14F FY15F FY16F Oil Consumption (mbpd) - LHS Proven Oil Reserves (mn bbl) - RHS Source: Ministry of Oil & Natural Gas; BMI forecasts; Aranca Research Notes: F – Forecast; CAGR – Compound Annual Growth Rate; mbpd – Million Barrels Per Day; mn bbl – Million Barrels; * – Provisional In FY12, imports accounted for approximately 81 per cent of Imports and domestic oil production in India the country’s total oil demand Backed by new oil fields, domestic oil output is anticipated to grow to 1.0 mbpd by FY16 3.3 3.5 2.9 3.0 3.2 2.5 2.7 2.5 2.7 0.7 0.7 0.7 0.8 0.8 1.0 1.0 1.0 1.0 FY08 FY09 FY10 FY11 FY12* FY13F FY14F FY15F FY16F Oil Production (mbpd) Oil Imports (mbpd) Source: Ministry of Oil & Natural Gas; BMI forecasts; Aranca Research Notes: F – Forecast; mbpd – Million Barrels Per Day; * – Provisional With India developing gas-fired power stations, Proven reserves and total gas consumption in the consumption is up more than 160 per cent since 1995 country (bcm) Demand is not likely to simmer down any time soon, given strong economic growth and rising urbanisation; during 1,330 1,330 1,330 1,330 1,330 FY2008–17F, gas consumption is likely to expand at a 1,330 CAGR of 21.0 per cent 1,278 1,149 1,115 1,090 175 165 109 150 137 51 47 46 32 31 FY08 FY09 FY10 FY11 FY12* FY13F FY14F FY15F FY16F FY17F Gas Consumption Proven Gas Reserves Source: Ministry of Oil & Natural Gas; Aranca Research Notes: F – Forecast; bcm – Billion Cubic Meters; CAGR – Compound Annual Growth Rate; * – Provisional Domestic production accounts for more than three-quarters Domestic gas production and imports (bcm) of total gas consumption in the country Imports constitute the rest; in 2012, the share of imports was 22.0 per cent 56 India increasingly relies on imported LNG; the country was 48 the sixth-largest LNG importer in 2011 and accounted for 32 32 12 12 13 23 5.3 per cent of global imports 12 11 64 47 52 48 43 44 47 51 India’s LNG imports are forecast to increase at a CAGR of 32 33 33 per cent during 2012–17 FY08 FY09 FY10 FY11 FY12* FY13F FY14F FY15F FY16F FY17F Gas Production Gas Imports Source: Ministry of Oil & Natural Gas; Aranca Research Notes: F – Forecast; bcm – Billion Cubic Meters; * – Provisional Total crude oil production was 38.0 mmt during FY12 Crude oil production (mmt) ONGC accounted for 62 per cent of total crude oil production in India 9.7 4.8 5.1 10.5 4.6 4.7 5.3 3.1 3.1 3.5 3.2 3.6 3.6 3.8 24.4 26.1 25.9 25.4 24.9 24.4 23.7 FY06 FY07 FY08 FY09 FY10 FY11 FY12* ONGC OIL Private/JV Source: Ministry of Petroleum & Natural Gas; Aranca Research Notes: mmt – Million Metric Tonne; * – Provisional; JV – Joint Venture Total gas production was 47.6 bcm during FY12 Annual gas production (bcm) The contribution from Private/JV has drastically increased over the last couple of years, following the development of the Reliance - Krishna Godavari (KG) basin 26.8 22.0 21.6 7.4 7.0 7.7 8.1 2.3 2.3 2.3 2.3 2.4 2.4 2.6 22.6 22.4 22.3 22.5 23.1 23.1 23.3 FY06 FY07 FY08 FY09 FY10 FY11 FY12* ONGC OIL Private/JV Source: Ministry of Petroleum & Natural Gas; Aranca Research Notes: mmt – Million Metric Tonne; * – Provisional; JV – Joint Venture During FY12, 1,631,000 meters of wells were explored and developed in India During the same period, 756 wells were drilled in the country Most upstream drilling and exploration work is undertaken by state-owned oil companies ONGC is the leader in the upstream segment and accounts for 62 per cent of total crude oil output in India Exploration activities (FY12*) (‘000 meters) Development drilling activities (FY12*) (‘000 meters) 129 295 62 740 87 467 409 198 Wells Metreage Wells Metreage Onshore Offshore Onshore Offshore Source: Ministry of Petroleum & Natural Gas; Aranca Research Notes: * – Provisional India has a network of 9,537 km of crude pipeline having a capacity of 138.3 mmtpa In terms of length, IOCL accounts for 45.9 per cent (4,376 km) of India’s crude pipeline network; moreover, the company has the country’s longest pipelines, namely the Salaya-Mathura-Panipat Pipeline (1870 km) and the Haldia-Barauni / Paradip-Barauni Pipeline (1302 km) In terms of capacity, ONGC leads the pack with a share of 47.4 per cent (65.5 mmtpa), followed by IOCL at 29.2 per cent (40.4 mmtpa) Shares in crude pipeline network by length Shares in crude pipeline network by capacity (out of 9,537 km ) (out of 138.3 mmtpa) 12.5% 6.1% OIL OIL 29.2% 11.9% ONGC ONGC 45.9% IOCL IOCL 47.4% Source: Ministry of Petroleum & Natural Gas; Aranca Research Notes: km – Kilometre; mmtpa – Million Metric Tonnes Per Annum Of the 11,218 km of refined products pipeline network (capacity of 76.3 mmtpa) in India, Indian Oil Corporation (IOC) accounts for 55 per cent (6,127 km) Gas Authority of India Limited (GAIL) has largest share (88 per cent or 2,038 km) of the country’s LPG pipeline network (2,312 km) Shares in product pipeline network by length Shares in LPG pipeline network by length (out of 11,218 km ) – FY12 (out of 2,312 km ) – FY12 3%0% 2% 12% 6% IOC IOC HPCL 15% BPCL GAIL 55% OIL PCCK 19% PMHB 88% Source: Ministry of Petroleum & Natural Gas; Aranca Research Notes: km – Kilometre; mmtpa – Million Metric Tonnes Per Annum, LPG - Liquefied Petroleum Gas, IOC - Indian Oil Corporation, HPCL - Hindustan Petroleum Corporation Ltd, BPCL - Bharat Petroleum Corporation Ltd, OIL - Oil India Limited, PMHB - Mangalore Hasan Bangalore, PCCK - Cochin-Coimbatore-Karur State-controlled entities dominate the downstream segment Refinery crude throughput (mmt) as well India has 19 refineries in the public sector and 3 in the private sector 90.7 90.5 80.7 In FY12, public sector refineries accounted for 57 per cent 43.6 48.6 of total refinery crude throughput 38.4 34.3 33.2 112.5 112.2 112.1 115.3 120.9 93.1 96.9 108.2 FY05