Sunday, March 30, 2008

India Turns to Angola for Oil

India Turns to Angola for Oil After Losing in Energy Auctions
By Manash Goswami
March 31 (Bloomberg)


India, Asia's third-largest consumer of oil, will focus on obtaining energy assets in Angola after failing to secure supplies closer to home.

``Angola is the next country where we are going to concentrate,'' Indian Oil Minister Murli Deora said in an interview in New Delhi. ``We lost because our bid wasn't good enough'' in previous auctions, he said. ``We have learned from this,'' the minister said.

State-run refiners from India and China are among 43 companies that have submitted bids for 11 oil blocks in Angola, OPEC's fastest-growing member. India's oil shortage has spurred Deora to turn to Angola, with reserves equivalent to 11 years of India's crude imports, after losing out to China in $10 billion of auctions in three years.

India's energy independence has been threatened because it hasn't been able to increase production at home, where output from three-decade-old fields is declining while economic growth boosts demand for gasoline and diesel. India will also compete for oil in Nigeria, Africa's biggest producer, and Sudan.

``India has to acquire assets overseas. There is no other way,'' said Prashant Periwal, an analyst at B&K Securities in London. ``China has slowly and steadily spread across most of Africa and is sitting on huge resources. For fuel security, you have to take control of supplies.''

India plans to resume talks with Pakistan over a $7.4 billion pipeline to transport natural gas from Iran after more than a decade of delays, Deora said.

Blackouts, Growth

Asia's third-largest economy can produce only half the gas it needs to generate electricity, causing blackouts and curbing economic growth. Demand may more than double to 400 million cubic meters a day by 2025 if the economy grows at the projected rate of 7 to 8 percent a year, according to the Oil Ministry.

India has been beaten by China to auctions for energy assets in Kazakhstan and Myanmar in the past three years. India has offered to build ports and railways in Nigeria and Sudan, copying tactics used by China.

India organized a two-day India-Africa conference in November to discuss oil cooperation, where Deora offered to build refineries and pipelines.

India, Venezuela

India, the fastest-growing economy after China, estimates its requirement for oil will rise 62 percent over the next five years to 241 million tons a year, or 4.8 million barrels a day.

Deora will travel to Venezuela next month to complete an agreement to acquire a stake in fields in the biggest crude- exporting nation in the Americas.

ONGC Videsh Ltd., the overseas exploration unit of Oil & Natural Gas Corp., India's biggest producer, will invest up to $356 million in a venture with state-owned Petroleos de Venezuela SA, to operate the San Cristobal area.

ONGC Videsh and China Petroleum & Chemical Corp., Asia's largest oil refiner, have been selected to bid for assets in Angola, according to state-run Sonangol SA. The African nation is offering 11 licenses for fields with a potential of 9.6 billion barrels of oil reserves, Sonangol said on its Web site.

Bidding Delayed

The bidding has been delayed after Angola extended the deadline indefinitely. The offers originally had to be submitted by March 13, according to Sonangol.

The auction will take place after elections in September, Diario Economico reported on March 19, without saying where it got the information.

1 comment:

bathmate said...

Thank you for your fantastic posting


Bathmate