Pradhan details UAE energy pacts
Abu Dhabi National Oil Company (ADNOC) will invest US$400 million by way of storing crude in an underground rock cavern in Mangalore, Karnataka.
ADNOC has signed an agreement with Indian Strategic Petroleum Reserves Ltd (ISPRL) to be partner in the crude oil storage facility in Mangalore. It would have capacity 5.86 million barrels (0.81 MMT).
Period of storage will be 3 years with automatic extension of 2+2 years.
The United Arab Emirates (UAE), through ADNOC, will be the first country to participate in India’s Strategic Petroleum Reserves Programme, Petroleum & Natural Gas Minister Dharmendra Pradhan, said in a statement on 13 Feb 2018.
“It is befitting that a strategic partner like the UAE is also India’s valued partner in the area of SPR,” he said.
The oil storage facility will help boost India’s energy security, as well as enable ADNOC to efficiently and competitively meet market demand in India and across the fast developing Southeast Asian economies, he elaborated.
The Concession Agreement for India’s 10% participation in Abu Dhabi’s offshore Lower Zakum oil field is to be effective from 9 March 2018.
India’s participation in the concession is through a consortium comprising ONGC Videsh, IOCL and BPRL.
Two agreements were signed in Abu Dhabi on 10 Feb 2018 during Prime Minister Narendra Modi’s visit to the emirate.
“The offshore concession in favour of the Indian consortium has taken our bilateral engagement in the oil and gas sector to a golden phase which is in sync with the comprehensive strategic partnership between our two countries,” said Pradhan.
India and the UAE have progressed from a buyer-seller relationship to an era of mutual investments in the oil and gas sector, he pointed out.
This will be the first Indian upstream investment in a producing asset in the Gulf region and in the Middle East.
The Concession Agreement will directly boost India’s energy security. Indian share of 900,000 barrels of DAS Crude for March, 2018 and 1.2 million barrels for April, 2018 has already been offered by ADNOC.
Participation will provide a valuable platform to Indian upstream companies to work alongside the international majors and thus expose them to the latest state-of-the-art technology and management practices.
With the Lower Zakhum acquisition, Indian oil and gas Public Sector Units (PSUs) have investments in 27 countries, including a major acquisition in Russia in 2016.
Indian PSUs – ONGC Videsh, IOCL, BPRL and Oil India Ltd jointly acquired 49.9% stake in Vankor oil field and 29.9% in Tassyurakh at an investment of US$5.5 billion.
This gave India equity oil of 15 MMTOE, which is about 40% of our annual domestic production.
“It is a commitment of the government to increase and diversify India’s overseas upstream footprint and to boost India’s energy security,” the minister stressed. fii-news.com
