Authorities in India have confessed that Africa’s rapid expansion of the hydrocarbon sector has led the Asian country to focus on the continent as a vital region for sourcing petroleum products in coming years.
India’s Minister of Petroleum and Natural Gas Shri Dharmendra Pradhan speaking at the 4th India-Africa Hydrocarbons Conference in Delhi recently said Indian oil companies now have keen interest in Africa because of the continent’s hydrocarbon potential.
The 2-day Conference attracted government and private sector officials from some of Africa’s oil producing countries in the north and those African nations which are emerging as oil producers like Uganda, Kenya and Ghana.
“As a matter of policy, the present Indian government is keen to move towards a geographically diversified energy basket. This has resulted in India's greater focus on Africa as a vital region for sourcing petroleum products in coming years,” Pradhan stated at the opening of the conference on 21st January.
India in 2014 imported 32 Million Metric Tonnes of crude in 2014 from Africa; 3 Million Metric Tonnes from North Africa and 29 Million Metric Tonnes from West Africa, mainly from Nigeria and Angola constituting approximately 16% of the country’s consumption.
“It is clear from our crude import figures that Africa has played an important role in India's energy security,” Pradhan asserted before calling for collaborative development and creating a brighter future for the people of India and Africa.
"There are several reasons for us to believe that Africa will be the perfect partner in the hydrocarbon space. India's scarcity of domestic energy resources can be offset by Africa's surplus energy reserves – which accounts for about 15% of current proved accessible global oil reserves.
Over the past two decades, the African hydrocarbon sector has seen rapid growth. The new discoveries in Africa have seen oil reserves grow by over 100% and gas reserves grow by over 55%. We believe that this will greatly improve Africa's position as an exporter of not only oil but also gas.
On the other hand, India has emerged as the fastest growing major economy in the world today with over 7% GDP growth. As per estimates by World Bank, IMF and others, this growth trend is expected to continue," Pradan submitted in his conference speech.
Accordingly, India's energy consumption has been constantly increasing. The Compound Annual Growth Rate (CAGR) of Indian primary energy consumption in the last 15 years has been about 7.3% as compared to a global CAGR of 3%.
To sustain economic growth, especially the manufacturing, India's energy demand is going up further. According to the International Energy Agency's (IEA) World Energy Outlook 2015, India will contribute around 25% of the growth in global energy demand and would thus be the single largest contributor to energy growth globally.
“We import nearly 78% of our crude oil & 35% of our natural gas requirements. However, while being deficient in natural hydrocarbon resources, we have built significant capacities and capabilities in products and processing of hydrocarbons.
Despite being a net importer of crude oil, India, with 23 refineries, has become a net exporter of petroleum products by investing in refineries designed for export. India has emerged as a refining hub with the fourth largest refining capacity in the world with 4.5% of world share.
Indian refineries have the highest complexity and can refine almost 180 kinds of crude. In 2014-15, India exported 63 Million Metric Tonnes of petroleum products to more than 55 countries around the world.” Pradhan emphasized.
The 4th India-Africa Hydrocarbons Conference, under the theme "Energizing the bottom of the pyramid – Together towards tomorrow", was building on successful accomplishment of the first three conferences held in 2007, 2009, and 2011 respectively.
It was organized by the Ministry of Petroleum and Natural Gas, Government of India, to advance discussions on energy co-operation between African nations and India.
The India-Africa Hydrocarbons Conference was conceptualized in 2007 with the objective to foster bilateral trade relations in the hydrocarbons sector, understand policy and regulatory frameworks and offer opportunities for strategic partnerships in upstream and downstream sectors of the two regions.