New Delhi : 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 explorers from India and China have submitted bids for oil blocks in Angola as the world’s two most populous nations need imports to sustain economic growth. India’s oil shortage has spurred Deora to turn to Angola, Opec’s fastest-growing member with reserves equivalent to 11 years of India’s imports, after losing out to China in $10 billion of auctions.
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. 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 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.
The South Asian nation hosted a two-day India-Africa conference in Nov-ember to discuss oil cooperation, where Deora offered to build refineries and pipelines.
India sought stakes of as much as 32 per cent in two fields in Sudan, R.S. Butola, managing director of ONGC Videsh, said during the November conference in New Delhi.
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.
The bidding has been delayed after Angola extended the deadline indefinitely.
Statistics: Growing demand
– India, the fastest-growing economy after China, estimates demand for oil will rise 62 per cent over the next five years to 241 million tonnes a year.
– 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 refiner, are among 43 companies that will bid to explore for oil in Angola, according to state-run Sonangol SA.
– The African nation is offering 11 licences for fields with a potential of 9.6 billion barrels of oil reserves, Sonangol said on its website.