Oil and gas minister M Veerappa Moily is doing what his colleague Mani Shankar Aiyar, the first oil and gas minister under the UPA regime, had initiated – shopping for India’s energy security overseas.
Buoyed by the success in Iraq – where he not only secured three discovered blocks for exploration by Indian companies but also convinced the Arab nation to look at an equity stake in Indian Oil’s Paradip refinery – and a positive meeting in Turkmenistan, Moily now has Kazakhstan, Azerbaijan and Iran on his wishlist.
“We have had 100% success in Iraq and finalised the Turkmenistan to India pipeline. Now, in the next three months, I will go to three more countries and conclude it with Iran in September or October,” he said on the sidelines of a conference.
Of the three countries on his wishlist, Kazakhstan is the only one where the consortium of OVL and Oil India have had a humiliating experience. The Kazakh government surprised them by exercising its pre-emptive right and agreeing to sell an 8.4% stake in its famed Kashagan oilfield to India’s arch competitor China, after having negotiated with India for almost nine months.
“In Kazakhstan, we had already negotiated with a private company to buy a stake in the field but the government there bought it themselves and so far have not sold that to anybody. So I am visiting there to request the government to sell some stake to us,” he said.
Moily said the government is also in talks with Anadarko to buy its 10% stake in the Rovuma basin. Currently, together with Bharat Petroleum’s overseas subsidiary Bharat PetroResources and OVL and Oil India, the total stake held by India in the basin is 20%.
However, Moily said the focus is not completely on overseas acquisition and alliances and the government is also focussing on making the PSUs stronger and grow faster.
“We have held one meeting with the oil PSUs and now will soon be holding yet another to ensure that they not only meet their 12th five year plan capital expenditure target but increase it even further and invest in acquisitions and growing capacity,” he said.
He said a decision on the shift from trade parity pricing to export parity pricing and a faster decision on subsidy is also being sought to make sure the oil companies in India are in a healthy shape.
Under Moily, India’s international energy asset quest started where Aiyar
left it in 2006. The two oil ministers – Murli Deora and Jaipal Reddy – who
came after Aiyar did nothing in this regard. They did not share Aiyar’s penchant for transnational pipelines and fixation with the rich oil and gas assets of Middle East and Central Asia. The much-talked about Turkmenistan-Afghanistan-Pakistan-India pipeline, which Moily recently pushed forward to a likely fruition, was also the brainchild of Aiyar in 2005. It never saw the light of the day since then and was almost dumped before being renewed by Moily.