Stating that the growing Indian economy would require tremendous amount of energy sources to maintain its pace, Prime Minister Manmohan Singh on Monday said India was encouraging its oil companies to acquire gas and oil assets abroad to meet the increasing demand that is likely to grow by 40 per cent in the next decade.
Delivering the inaugural address at the three-day Petrotech 2010 Oil and Gas Conference at Vigyan Bhavan here , Dr. Singh said it was important to secure energy supplies at affordable prices to meet the requirements of the rapidly expanding economy. “India needs adequate supplies of energy at affordable prices to meet the demand.'' India, which consumed over 138 million tonnes of fuel in 2009-10, imports three-fourth of its oil needs and one-third of its gas requirement. It imported $79.5 billion worth of 159.2 million tonnes of crude oil.
“Demand over the next 10 years will increase by over 40 per cent, whereas the increase in supply from the maturing domestic oilfields is expected to be around 12 per cent,'' he said.
Dr. Singh said the present domestic sources are inadequate to meet the increasing demand for energy. The nation's domestic oil production was about 34 million tonnes in the last fiscal. To bridge the shortfall, the government was encouraging national oil companies to acquire oil and gas fields abroad. He stressed building strong economic partnership with hydrocarbon-rich countries. Stating that oil and gas today were not seen as mere commodities to be traded freely, Dr. Singh said they are often used by countries to meet their political objectives.
Dr. Singh said during the last two decades, Asia's share in the growth in demand for hydrocarbons has risen substantially while that of the OECD countries and the European Union had declined.
“This shift has been caused by high rates of economic growth and increasing population in many Asian countries. There are supply-side uncertainties. Many mature fields are declining in production. Some energy endowed countries have problems in augmenting production because of various reasons including lack of the required technology and political uncertainty,'' Dr. Singh said.
Another challenge, he said, is climate change. “Because of this challenge, the demand on energy technologies goes beyond productivity and efficiency issues,” he said, calling for a rethink on the traditional energy basket being loaded in favour of fossil fuels.
Major energy source
Dr. Singh said hydrocarbons would continue to be the major source of energy for quite sometime in the future for India.
Partnerships being built
“We seek to build strong economic partnerships with other producing countries and their oil and gas industries to the mutual benefit of each other. We also seek to work together with other countries especially those which are active in the oil and gas space to tackle the problem of climate change,'' he remarked.