Petroleum Minister’s address at the Economic Editors’ Conference 2009
Following is the text of opening remarks made by the Minister of Petroleum & Natural Gas Shri Murli Deora at the Economic Editors’ Conference 2009 held here today:
“Friends from the Media, Secretary, Shri R.S. Pandey, other officials of the Ministry of Petroleum and Natural Gas and the representatives of the Oil and Gas Sector.
Petroleum Sector touches every human life in this country either directly or indirectly. It plays a crucial role in every day’s life from the poor women using Kerosene in the remotest village to the executive flying in modern air craft. It plays pivotal role in the economic progress of the country working round clock to provide petroleum products across the spectrum of the country right from the hearth of the home to the big Industries to agriculture to transport and so on.
Our Ministry has circulated a background note which contains detailed information on petroleum and gas sector. It hardly needs to be emphasised that energy is a crucial input in our development process and our energy requirement for growth is indeed very large. Oil and Gas constitute over 40% of all energy sources. At the same time, the dependence on imports of petroleum and petroleum products continues to be around 80% of total oil consumption in the country. It is important to undertake optimal exploitation of energy resources with a view to increasing our country’s energy security.
I am happy to inform you that during the current financial year there have been 15 new oil discoveries by ONGC, OIL and Private/JV Companies that should contribute to increasing the availability of oil in the country. It is projected that during the current financial year (2009-10) crude oil production should increase by 11% to reach 36.708 MMT. It is also projected that the production of natural gas during the current financial year (2009-10) should reach 50.211 BCM which is 52.8% higher than the previous year. This has been a landmark year for additional production of oil and gas.
During the course of the current year, 2009-10, the prices of crude oil have increased steadily from US$44 per barrel in January 2009 to $76 per barrel as on 29th October, 2009. With the World outlook recovering from the recession of the last year, we can expect that global demand and, even prices of crude oil may rise. We have to ensure uninterrupted supply of sensitive petroleum products in the country to support steady growth of the economy as well as to meet requirements of the common man.
I may mention that even though there had been substantial increase in international crude oil prices during last year, the Government has not passed on the burden to the common man. When the retail selling prices of the four sensitive petroleum products are compared with the prices in June 2006, it may be seen that the prices of Petrol is lower today. On 6th June, 2006 the price of Petrol was Rs.47.51 per litre and on 3rd November 2009 it is lower at Rs.44.72 per litre. The prices of Diesel, PDS Kerosene and Domestic LPG are almost the same. The price of Kerosene have remain unchanged at is Rs. 9 per litre during the last 5 years, which is a poor’s man fuel. Even the price of Domestic LPG Cylinder is Rs. 281.20 per cylinder on 03.11.2009 which is cheaper than in June, 2006, which was Rs. 294.75 per cylinder.
The Government decided not to pass on the full impact of the global prices that even reached $142 per barrel in July 2008, to protect the interest of “Aam Adami” and provide petroleum products at affordable rates. The PSU Oil Marketing Companies continue to face a combined under-recovery of Rs.15856 crores during the first half of the current year.
Rajiv Gandhi Gramin LPG Vitrak Yojana
A new scheme called Rajiv Gandhi Gramin LPG Vitrak (RGGLV) was launched in October, 2009 for setting up small size LPG Distributorship in order to increase penetration of LPG in rural areas. Vision 2015 envisages the increase in population coverage from 50% to 75% of the population. Currently Oil Marketing Companies are serving approximately 11 Crores LPG customers in the country. This would increase to 15 Crores customer in the next 5 years. The Scheme will also provide new employment opportunities for the rural population leading to overall economic prosperity.
NELP and CBM Policy
Under the recently concluded NELP-VIII and CBM-IV Round, the Government received 76 bids for 36 blocks out of 70 blocks offered under NELP-VIII and 26 bids for 8 blocks out of 10 blocks offered under CBM-IV. The response of E&P industry has been encouraging in the context of the global financial situation and responses to similar offers in many other countries. A total of 62 companies 10 foreign and 52 Indian have bid either on their own or as a part of consortia. The total committed investment during previous NELP rounds is about US $ 10 Billion. In NELP VIII, total committed investment is to the tune of US $ 1.34 Billion.
Domestic Oil and Gas Production
During the current financial year (2009-10), projected production for crude oil is 36.708 Million Metric Tonne (MMT) against previous year production of 33.508 MMT. The increase of about 3.2 MMT in crude oil production in 2009-10 is from Rajasthan (2.4 MMT) and KG deepwater (0.8 MMT). The projected production for natural gas (including CBM) for 2009-10 is 50.211 Billion Cubic Metre (BCM) against 32.847 BCM in 2008-09.
The Improved Oil Recovery and Enhanced Oil Recovery projects of ONGC are under way in its 18 largest fields. The cumulative incremental oil gain up to March 2009 has been of the order of 46.26 million tonnes. ONGC expects to extract additional production of 14 million tonnes of oil and 16 BCM of gas from its marginal fields during the current Plan period.
Equity Oil Abroad
During 2008-09, ONGC Videsh Ltd. (OVL) acquired 7 blocks abroad in 5 countries. OVL produced about 8.75 Million Metric Tonnes (MMT) of oil and equivalent gas during the year 2008-09 from its assets abroad in Sudan, Vietnam, Venezuela, Russia, Syria and Colombia.
Refinery Performance
Indian refineries have been performing well in contributing to the domestic availability of sensitive petroleum products as well as in exports. The total installed capacity of refineries has increased to 177.97 MMTPA since commissioning of Reliance Petro Limited (SEZ) Refinery at Jamnagar, Gujarat. During the first half of the current year, the average capacity utilization of our refineries has been 103%. Exports of POL still accounted for 10% of total exports during April-September 2009-10 and continue to be the single largest merchandise exports from India. The new refineries at Bhatinda, Paradip and Bina would further augment the domestic refinery capacity making India as major refinery hub is South Asia.
International Cooperation
Our Ministry in association with the Federation of Indian Chambers of Commerce and Industry (FICCI), is organizing the 2nd India-Africa Hydrocarbons Conference in New Delhi on 7-8 December 2009. The main objective of the Conference is to bring together Ministers in-charge of oil and gas, top Government officers and captains of the industry for common benefit. Invitation has been extended to 22 African countries.
Initiatives towards better customer services
The initiatives taken by the Government / Public Sector Oil Marketing Companies (OMCs) in containing the menace of adulteration include, inter alia, (a) Automation of 4851 retail outlets by the three OMCs so far (b) Information Technology (IT) solutions like monitoring movement of tank trucks (TT) through Global Positioning System (GPS), and (c) third party certification of retail outlets and so far 72% target ROs have been completed.
Public Grievance Redressal System of OMCs
In order to address effectively the complaints made by the public in regard to supply and distribution of petroleum products across the country, the OMCs have installed Unique Toll Free telephone numbers to register complaints round the clock.
Conclusion
A major fire incident took place at IOC’s Oil Depot at Jaipur on 29th October, 2009 resulting in loss of precious human life and property. To prevent the recurrence of such incidents, I had taken a meeting yesterday of the Oil Industry including Private Sector to formulate a Joint Action Plan to handle such situations in future. Ministry will continue to work towards evolving effective policy measures to tide over the problems being confronted by the Oil & Gas sector. In this regard, the media has a vital role in informing the public the challenges faced by the Indian economy particularly the oil and gas sector and measures taken by the Government to ensure growth and stability of the economy.”
Following is the text of opening remarks made by the Minister of Petroleum & Natural Gas Shri Murli Deora at the Economic Editors’ Conference 2009 held here today:
“Friends from the Media, Secretary, Shri R.S. Pandey, other officials of the Ministry of Petroleum and Natural Gas and the representatives of the Oil and Gas Sector.
Petroleum Sector touches every human life in this country either directly or indirectly. It plays a crucial role in every day’s life from the poor women using Kerosene in the remotest village to the executive flying in modern air craft. It plays pivotal role in the economic progress of the country working round clock to provide petroleum products across the spectrum of the country right from the hearth of the home to the big Industries to agriculture to transport and so on.
Our Ministry has circulated a background note which contains detailed information on petroleum and gas sector. It hardly needs to be emphasised that energy is a crucial input in our development process and our energy requirement for growth is indeed very large. Oil and Gas constitute over 40% of all energy sources. At the same time, the dependence on imports of petroleum and petroleum products continues to be around 80% of total oil consumption in the country. It is important to undertake optimal exploitation of energy resources with a view to increasing our country’s energy security.
I am happy to inform you that during the current financial year there have been 15 new oil discoveries by ONGC, OIL and Private/JV Companies that should contribute to increasing the availability of oil in the country. It is projected that during the current financial year (2009-10) crude oil production should increase by 11% to reach 36.708 MMT. It is also projected that the production of natural gas during the current financial year (2009-10) should reach 50.211 BCM which is 52.8% higher than the previous year. This has been a landmark year for additional production of oil and gas.
During the course of the current year, 2009-10, the prices of crude oil have increased steadily from US$44 per barrel in January 2009 to $76 per barrel as on 29th October, 2009. With the World outlook recovering from the recession of the last year, we can expect that global demand and, even prices of crude oil may rise. We have to ensure uninterrupted supply of sensitive petroleum products in the country to support steady growth of the economy as well as to meet requirements of the common man.
I may mention that even though there had been substantial increase in international crude oil prices during last year, the Government has not passed on the burden to the common man. When the retail selling prices of the four sensitive petroleum products are compared with the prices in June 2006, it may be seen that the prices of Petrol is lower today. On 6th June, 2006 the price of Petrol was Rs.47.51 per litre and on 3rd November 2009 it is lower at Rs.44.72 per litre. The prices of Diesel, PDS Kerosene and Domestic LPG are almost the same. The price of Kerosene have remain unchanged at is Rs. 9 per litre during the last 5 years, which is a poor’s man fuel. Even the price of Domestic LPG Cylinder is Rs. 281.20 per cylinder on 03.11.2009 which is cheaper than in June, 2006, which was Rs. 294.75 per cylinder.
The Government decided not to pass on the full impact of the global prices that even reached $142 per barrel in July 2008, to protect the interest of “Aam Adami” and provide petroleum products at affordable rates. The PSU Oil Marketing Companies continue to face a combined under-recovery of Rs.15856 crores during the first half of the current year.
Rajiv Gandhi Gramin LPG Vitrak Yojana
A new scheme called Rajiv Gandhi Gramin LPG Vitrak (RGGLV) was launched in October, 2009 for setting up small size LPG Distributorship in order to increase penetration of LPG in rural areas. Vision 2015 envisages the increase in population coverage from 50% to 75% of the population. Currently Oil Marketing Companies are serving approximately 11 Crores LPG customers in the country. This would increase to 15 Crores customer in the next 5 years. The Scheme will also provide new employment opportunities for the rural population leading to overall economic prosperity.
NELP and CBM Policy
Under the recently concluded NELP-VIII and CBM-IV Round, the Government received 76 bids for 36 blocks out of 70 blocks offered under NELP-VIII and 26 bids for 8 blocks out of 10 blocks offered under CBM-IV. The response of E&P industry has been encouraging in the context of the global financial situation and responses to similar offers in many other countries. A total of 62 companies 10 foreign and 52 Indian have bid either on their own or as a part of consortia. The total committed investment during previous NELP rounds is about US $ 10 Billion. In NELP VIII, total committed investment is to the tune of US $ 1.34 Billion.
Domestic Oil and Gas Production
During the current financial year (2009-10), projected production for crude oil is 36.708 Million Metric Tonne (MMT) against previous year production of 33.508 MMT. The increase of about 3.2 MMT in crude oil production in 2009-10 is from Rajasthan (2.4 MMT) and KG deepwater (0.8 MMT). The projected production for natural gas (including CBM) for 2009-10 is 50.211 Billion Cubic Metre (BCM) against 32.847 BCM in 2008-09.
The Improved Oil Recovery and Enhanced Oil Recovery projects of ONGC are under way in its 18 largest fields. The cumulative incremental oil gain up to March 2009 has been of the order of 46.26 million tonnes. ONGC expects to extract additional production of 14 million tonnes of oil and 16 BCM of gas from its marginal fields during the current Plan period.
Equity Oil Abroad
During 2008-09, ONGC Videsh Ltd. (OVL) acquired 7 blocks abroad in 5 countries. OVL produced about 8.75 Million Metric Tonnes (MMT) of oil and equivalent gas during the year 2008-09 from its assets abroad in Sudan, Vietnam, Venezuela, Russia, Syria and Colombia.
Refinery Performance
Indian refineries have been performing well in contributing to the domestic availability of sensitive petroleum products as well as in exports. The total installed capacity of refineries has increased to 177.97 MMTPA since commissioning of Reliance Petro Limited (SEZ) Refinery at Jamnagar, Gujarat. During the first half of the current year, the average capacity utilization of our refineries has been 103%. Exports of POL still accounted for 10% of total exports during April-September 2009-10 and continue to be the single largest merchandise exports from India. The new refineries at Bhatinda, Paradip and Bina would further augment the domestic refinery capacity making India as major refinery hub is South Asia.
International Cooperation
Our Ministry in association with the Federation of Indian Chambers of Commerce and Industry (FICCI), is organizing the 2nd India-Africa Hydrocarbons Conference in New Delhi on 7-8 December 2009. The main objective of the Conference is to bring together Ministers in-charge of oil and gas, top Government officers and captains of the industry for common benefit. Invitation has been extended to 22 African countries.
Initiatives towards better customer services
The initiatives taken by the Government / Public Sector Oil Marketing Companies (OMCs) in containing the menace of adulteration include, inter alia, (a) Automation of 4851 retail outlets by the three OMCs so far (b) Information Technology (IT) solutions like monitoring movement of tank trucks (TT) through Global Positioning System (GPS), and (c) third party certification of retail outlets and so far 72% target ROs have been completed.
Public Grievance Redressal System of OMCs
In order to address effectively the complaints made by the public in regard to supply and distribution of petroleum products across the country, the OMCs have installed Unique Toll Free telephone numbers to register complaints round the clock.
Conclusion
A major fire incident took place at IOC’s Oil Depot at Jaipur on 29th October, 2009 resulting in loss of precious human life and property. To prevent the recurrence of such incidents, I had taken a meeting yesterday of the Oil Industry including Private Sector to formulate a Joint Action Plan to handle such situations in future. Ministry will continue to work towards evolving effective policy measures to tide over the problems being confronted by the Oil & Gas sector. In this regard, the media has a vital role in informing the public the challenges faced by the Indian economy particularly the oil and gas sector and measures taken by the Government to ensure growth and stability of the economy.”
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