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Cairn ACE Season 3

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ACE - The case study challenge by Cairn India aims to find the Amazing Champions of Energy across India. Participants are given a business case addressing concerns in oil and gas industry of India and they are expected to come up with innovative solutions.

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Cairn ACE Season 3

  1. 1. CASE OF OIL & GAS POLICY FRAMEWORK IN INDIA IS INDIA REALLY ENERGY SECURE ?
  2. 2. This About Before getting started we have to know what we would talk about in next few minutes. So it is all about E&P sector of any country. E&P (Exploration and Production sector) stands for upstream oil and gas industry of the country.
  3. 3. (all data in mbpd) 2001-02 2002-03 2005-06 Demand 99.70 Supply 32.03 Gap 67.67 Demand 114.30 Supply 33.05 Gap 81.25 Demand 140.60 Supply 33.98 Gap 106.02 Demand 199.60 Supply 33.47 Gap 166.13 2011-12 Gap Over years 67.6 81.2 106.1 166.13 (all data in mbpd) Upstream Usance Coal 41% Petroleum 23% Solid biomass & waste 23% Natural gas 8% Nuclear & other renewables 5% Source: US Energy Information Administration (EIA); Asia-Pacific Economic Cooperation (APEC); Aranca Research Notes: Mtoe – Million Tonne of Oil Equivalent Consumption Pattern in 2011 FUTURE CONJECTURES OF INDIAN ENERGY FUEL MIXCoal 42% Petroleum 24% Solid biomass & waste 15% Natural gas 11% Nuclear & other renewables 8% Source: International Energy Agency (IEA); 12th Five-Year Plan; Aranca Research Consumption Pattern Expected in 2035 Oil consumption is estimated to expand at a CAGR of 3.4 per cent during FY2008–16F to 4.0 mbpd by 2016 Owing to this strong expected growth in demand, India’s dependency on oil imports is expected to increase further Statistics show that only 30% blocks(acreages) in India is being explored by various public or private companies. so question is that “Is India really in stringent condition in E&P field? answer is NO. We are affluent in sources but our efforts to harness them are limited as well as trite.
  4. 4. WHY ALL THESE STATICS ?ENERGY SECURITY is defined comprehensively in India, as “we are energy secure when we can supply lifeline energy to all our citizens irrespective of their ability to pay for it as well as meet their effective demand for safe and convenient energy to satisfy their various needs at competitive prices, at all times and with a prescribed confidence level considering shocks and disruptions that can be reasonably expected” (PC, 2006). ENERGY SELFSUFFIENCY is the state of a country to be Energy secure as well as self dependent with reference to its energy needs . It is the state of a a country which fulfills all its energy needs via any wayEnergy security on our own So the conclusion is “ If a country is self-sufficient then it will be Energy secured definitely But not vice-versa”. Observing all the attached statics We found that “ IS NEITHER ENERGY SECURED NOR SELF DEPENDENT IN EXTANT SCENARIO AND CONDITIONSS ARE GETTING INTRICATE GRADUALLY”.
  5. 5. PRESENTE&P POLICY SCENARIO IN ENERGY ACCESS CLIMATE CHANGE ENERGY SECURITY INDIAN POLICY OBJECTS In India a control center called “Ministry of petroleum and natural gas" by govt. of India is established which governs all the actions of E&P sector like exploration , production , refining , bidding etc. Some government FORMULAE FDI SUBSIDY ABOUT • NEW EXPLORATION LICENSING POLICY • Established in Feb 1999 PROS • Provides Equal competitive platform to all • Entices foreign companies in Indian market CONS • Some policies under it like extension policy • Affects adversely the sprit of companies • Also acts a deterrent for idler companies ABOUT • FOREIGN DIRECT INVESTMENT • Established in Feb 1991 PROS • Newly offered 100% FDI is very alluring • Automatic root is very fast CONS • Still many of sectors are restricted to 51% • Govt. root is procrastinated and time taking ABOUT • DIMINISHED PRICES BY GOVT. FOR PEOPLE • Subsidy on LPG was first introduced in 196 PROS • Affordable energy to poor people • Provides lifeline to non-capable CONS • It is converted into shits like CORRUPTION BLACKMARKET etc. • Due to this poor is getting poorer and rich is getting richer
  6. 6. FUTURE DOES INDIA NEED SOMETHING NEW FOR A BETTER The answer is yes, we need that as we saw, extant govt. policies have some pitfalls which hinder the desired growth of O&G sector in India. So for a secured as well as prosperous tomorrow, India needs a new policy design SOLUTIONS ACCORDING TO US THE PROPOSED • Extension policy should be reformed and extensions must be given only if necessary • Currently prices and location is determined only by govt., which is declining factor to companies, should be flexible. • Fiscal package should not be in such a way that companies stammer before invest in India. • Almost all sectors should be subjected to 100% FDI • Govt. route must be logistic and fast as well as automatic rule. • Subsidy plan should be according to pay scale of family, low pay scale people would get high subsidy and affluent ones would get less of that, this balanced plan must be carried out for better future and also transparency should invoke. Beyond all these let us think for a while, India in present is not a poor reservoir of energy, but the main issue is that we are not able to access them. So what is the baffle to this? Where are we lack in? Is the answer is technology, finance, support etc.? No these are only bugs that can be fixed if we want. The main obstacle is "how keen are we towards this goal?" we lost the hope, we lost the positivity. All we have to do, that is to be determined badly towards our goal, the misuse of the various policies has to be stopped, and the development of Indian energy must be at first priority. ARE:
  7. 7. SOME INTERNATIONAL GOOD POLICIES JUST IMPLIMENTATION OF EXISTING PLANS AND POLICIES DOESN’T MEAN THAT THE COUNTRIES ARE TRYING TO BE ENERGY SECURE. SOME EXTRA EFFORTS ARE TO BE INVOKED TO BE AT THE CREST OF WORLD RANKINGS IN PRESENT COMPITITIVE ERA. SUCH AS WORK HAS SHOWED BY & • Land Stewardship • Sustainable Communities • Technology Based On Water CANADA • Technology Advancement like Underground lightning, Horizontal Drilling. • Carbon Reducing Formulae • Focus on Health, Safety & Environmental Issues UNITED STATES
  8. 8. TIMELY ACTION ON ENERGY SECURITY •Hackneyed and dawdling govt. formalities must be flexible and soar.1 • Ministry rules and policies must be alluring to foreign countries to invest in India . 2 • Efforts to be in such a direction to dwindle imports in India.3 •Renewable sources , a dazing way to most of the problems should be approached.4 • Bicameral parliament rules shouldn’t be acted in oil and gas sector, there should be one central control center for all public and private companies in India irrespective of states in which they are . 5 • 6. All govt. policies like NELP, subsidy, FDI, FII, have to be revised and revived time to time for get along with global competition.6
  9. 9. ROADMAP FOR
  10. 10. WHAT IS THE CONCLUSION? AFTER OBSERVING PREVIOUS SLIDES WE CAN SAY IN CONCISE WAY THAT PRESENTLY INDIA IS NEITHER SELF SECURE NOR SELF DEPENDENT, BUT WE ARE CAPABLE TO BE IF WE RIDE OUR POLICY VEHICLE ON THE PROPOSED ROADMAP. w.iea.org www.petroleum.nic.in www.google.com/im

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