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Energy Scenario & Opportunities

Detailed exploration of energy consumption, demand projections, and production potential in India and Russia, highlighting opportunities for strategic collaboration. Data sourced from reputable reports and projections by industry experts.

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Energy Scenario & Opportunities

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  1. Energy Scenario & Opportunities Anurag SharmaSr. Vice PresidentONGC Videsh Ltd. 3rd India-Russia Forum on Trade and Investment 29th September 2009Moscow

  2. Disclaimer • This presentation does not provide individually tailored advice but is an effort to expresses views on the topic and does not contain any information of strategic nature emerging from the ONGC group of Companies. • The correctness and completeness of the data is not a contendable matter as the sources and the base of the data may be different altogether. • This presentation has been prepared without regard to any pressure group, institution, lobby on international affairs or relations, and it is not meant to aim at any individual, institution, group, country, government or political representatives, its ideology, thinking or prophesy. • The views expressed in the presentation are broadly illustrative and do not aim at creating an opinion on the functioning of ONGC Group of companies, and nor is meant to impress any ideology or thinking among the audience. • This presentation may have views that may be considered debatable, and may not conform to different views for any number of reasons. However, provided that the item is relevant and is from a responsible source, it is believe that it is important to bring it to the attention of all - regardless of whether or not it is agreeable.

  3. Contents

  4. India Energy Overview

  5. Business Potential • India: one of the largest growing economies • Infrastructure development on big agenda • One of the largest growing energy markets • Big opportunities in energy sector

  6. Energy Consumption India: the 5thlargest primary energy consumer CAGR (1998-2008): 4.5% (global CAGR: 2.2%) 4% of total Primary Energy consumption (MTOE) Per Capita Energy consumption (TOE) • Per Capita energy consumption only 30% of global average Source: BP Statistical Review of World Energy-2009

  7. Energy Basket : 2009 Oil & Gas composition -India: 40%; global average 64% Source: BP Statistical Review of World Energy-2009

  8. Growing Primary Energy demand … India 1633 MTOE • With development of East Coast, new & marginal fields of West coast, CBM, UCG, and likely trans-national gas trunk lines- the gas demand seems to be achievable • For oil, though importer for over 25 years, considering the dramatic rise in volume demand CAGR= 6% Gas CAGR= 7.9% 433 MTOE Oil CAGR= 5.2% *Source: BP Statistical Review 2009 Projected figure Source: Integrated Energy Policy

  9. Oil consumption • World oil consumption (2008) 3,928 Million Tonnes • India 4th largest consumer of Oil: 3.4% of total • India’s Oil consumption increased at CAGR of 4 % (1998-2008) against the world CAGR of 1.4%. Source: BP Statistical Review 2009

  10. Crude Oil Demand • India’s crude oil requirement is 129 MMT (net) • Likely to go up to 280 MMT by 2025 (Power & Energy Division of Planning Commission) • Estimated Crude Demand of 370 MMT to 435 MMT @ 7% -8% GDP growth (Integrated Energy Policy, Planning Commission) Source: MOP&NG & Planning Commission

  11. Dependence on Oil Imports Increasing dependence on oil imports; likely to be more than 80%.

  12. Energy Outlook For India, with 16% of global population; 0.5% of world’s Petroleum reserve and ~10 % of world’s Coal reserve; with a 8- 10% GDP growth target and 4.5% CAGR in energy demandthe situation is pretty Challenging…

  13. Russia – An Overview • World's largest natural gas reserves : 1,680 TCF • World's largest exporter of natural gas • Second largest coal reserves : 173 billion tons • Eighth largest oil reserves : ~80 billion barrels • Produces 9.74 million bbl/d • Second largest oil exporter • Exports around 4.5 million bbl/d. • 45 refineries with total capacity of over 5.5 million barrels per day. • In 2008, Russia’s real gross domestic product (GDP) grew by approximately 6 percent.

  14. Exploration & Production of Oil & Gas in India & NELP

  15. Sedimentary Basins • 26 sedimentary basins with total basinal area of 3.14 million sq.km. SHALLOW WATER 0.4 Million Sq Km ONLAND 1.39 Million Sq Km 14% 44 % 42 % DEEP WATER 1.35 Million Sq Km

  16. Exploration & Production Status AREA UNDER LICENCE YET TO OFFER ONLAND 0.99 Million Sq Km DEEP WATER 0.49 Million Sq Km DEEP WATER 0.86 Million Sq Km ONLAND 0.4 Million Sq Km 46 % 40 % 40% 50% 14% 10% • 100% coverage is targeted for 2011 • 28 Billion tons of Resource Prognosticated • 1300 BCM of Coal Bed Methane & 1700 BCM of Gas Hydrate SHALLOW WATER 0.3 Million Sq Km SHALLOW WATER 0.1 Million Sq Km 2.15 Million Sq Km (68%) 0.99 Million Sq Km (32%) Source: DGH

  17. Level of Exploration Indian sedimentary basins with low drilling density require technology & capital intensive accelerated exploration Source: Petroleum Exploration & Production Activities, India, 2007-08, DGH Estimated investment* required: US$50 billion in next 15-20 years *Ref: Ernst & Young; “Securing India’s Hydrocarbon future” in OCEANTEX, 2006

  18. Effective since 1999 Award of licenses through international competitive bidding Fast track approval mechanism Directorate General of Hydrocarbon (DGH) as single window No State participation or any carried interest International pricing for Crude oil & market driven prices for Natural gas New Exploration Licensing Policy

  19. BLOCKS CONTRACTED

  20. ONGC an introduction

  21. Oil & Natural Gas Corporation Ltd. (ONGC) AnIndian State Enterprise, Integrated Oil & Gas Group with interests in E&P, Refining, LNG, Power, Petrochemicals & New sources of energy … a reliable energy solution provider

  22. ONGC Group Overseas E&P Refinery SEZ Value-chain Services (23%) (100%) (26%) (71.6%) (23%) (21.5%) (23%) (49*%) Joint Ventures Subsidiaries (50%) (50%) (100%) (12%) (50%) (100%) ONGC Campos Holdings Ltda ONGC Do Brasil Explorancao Petrolifera Ltda (100%) Power (100%) (50%) (100%) ONGC Amazon Alaknanda Ltd (OAAL) * OMPL: 46% ONGC & 3% MRPL

  23. ONGC Group produces ~ 1.2 million barrels per day of Oil plus Oil-equivalent Gas, from a balance reserve of >11 billion barrels; refines about 12.5 MMTPA (>270,000 bopd); extracts about 3 MMTPA of Value Added Products sells Crude Oil, Gas and Value Added Products (LPG, Naphtha, Ethane-Propane, SKO, HSD, MS etc.) with a turnover of USD 23.83 billion (2008-09).

  24. ONGC, the Most ValuableIndian Public Sector Undertaking ONGC GROUP ~ a zero debt company

  25. In House Capabilities ONGC has in-house capability in all aspects of the Oil & Gas Business API*, Drilling, Workover & Well Testing & Stimulation, Production, Processing, Reservoir Management, Applied R&D, Engineering & Construction, Transportation, Refining, Marketing, Training, etc. * API- Acquisition, Processing & Interpretation of Seismic Data

  26. E&P Infrastructure State-of-the-art exploration facilities 28 Seismic Crew 114 Drilling Rig 78 Work Over Rig 107 Well Stimulation Unit 26

  27. E&P Infrastructure Globally comparable Production & Transportation facilities 240 Onshore Installations 194 Offshore Installations > 22,000 Km Pipelines 61 Offshore Supply Vessels 27

  28. ONGC : Processing Facilities Hazira, Gujarat • Handling Capacity: 42 MMSCMD Sour Gas • Products : Gas, LPG, Naphtha, SKO, HSD, ATF Uran, Maharashtra • Handling Capacity: 20 MMTPA Oil & 16 MMSCMD Gas • Products :Oil, Gas, LPG, Naphtha,C2-C3 Ankleshwar and Gandhar, Gujarat • Handling Capacity: 0.1 MMTPA Oil & 1 MMSCMD Gas • Products : LPG, Naphtha LPG- Liquefied Petroleum Gas SKO- Superior Kerosene Oil C2-C3- Ethane- Propane HSD- High Speed Diesel LSHS- Low Sulphur Heavy Stock ATF- Aviation Turbine Fuel Tatipaka Mini-Refinery, Andhra Pradesh • Handling Capacity: 66,000 TPA Oil • Products : Naphtha, SKO, HSD, LSHS • Kuthalam VAP Plant, Tamilnadu: • Under commissioning • MMTPA- Million Tonne Per Annum • MMSCMD-Million Standard Cubic Meter per day

  29. KDMIPE IRS IPSHEM IOGPT CEWELL Energy Centre Institutes GEOPIC IDT ONGC Academy IEOT SMP INBIGS ONGC Institutes

  30. ONGC- as an E&P company ONGC discovered 6 out of the 7 producing Basins of India 1889: Assam Shelf * 1967: Rajasthan Basin 1973: A&AA FB 1958: Cambay Basin 1980: KG Basin 1974: Mumbai Offshore 1985: Cauvery Basin * By AR & T Co. - Assam Railways and Trading Company Ltd.

  31. E&P Acreage Holding (Sq Km) ONGC is the largest E&P acreage holder in India (PEL: 48% & ML: 67%) ONGC has been awarded more than 50% of NELP acreage (104 out of 203; up to NELP VII round) ONGC total acreages: 155 including 71 Nomination Source: E&P Activity Report 2007-08; DGH

  32. Dominant E&P Player ONGC accounts for around 79% of Indian domestic oil & gas production Includes ONGC’s share of production from Joint Venture/ PSCs Source: MoPNG ; Provisional data-FY’09

  33. O+OEG Production Maintaining Production Levels MTOE 61.81 61.22

  34. Reserve Accretion FY’09: Ultimate Reserve Accretion (3P) = 206.806 MTOE the highest in last 18 years OVL: 135.08 MTOE JV share: 2.82 MTOE

  35. Reserve Position As on 01.04.2009, Total Reserves (3P): 1,591.53 MTOE

  36. Recognitions Global Energy Company 2008 #1 E&P Company in the world ONGC 25th in the List of Top Energy Companies in the World Ranked on assets, revenue, profit & ROC

  37. ONGC Videsh Limited Overseas E&P Operations

  38. Equity Oil & Gas * 40th Project is Sudan’s 741 km long completed Pipeline 40th project is the Sudan Pipeline Project

  39. Producing Properties 9 producing assets with OVL

  40. Equity Oil & Gas 8.80 5.06 6.34 7.95 8.78 CAGR: 14.8%

  41. Overseas Reserves FY’09: Ultimate Reserve accretion 135.08 MTOE … the highest-ever Reserves position (as on 31.03.09)

  42. Sakhalin-1 • Partners: Exxon, SMNG and RN-Astra; Sodeco Ltd.; and ONGC Videsh Ltd. • The Project area is comprised of the Chayvo, Odoptu and Arkutun-Dagi fields. • Total recoverable reserves are estimated to be 2.3 billion barrels of oil (307 million tons) and 17.1 TCF of natural gas (485 BCM). • Successful ramp-up of production to design levels of 250,000 barrels (34,000 metric tons) of oil per day. • The Project now supplies crude to international markets and natural gas to the Russian Far East.

  43. Imperial Energy New Acquisition • Producing Asset in West Siberia • 946 MMBoe of Oil & Gas Reserves • Acquired in Jan 2009 • Production up from 6000 bpd on acquisition to >12,000 bpd • Largest Overseas Corporate Acquisition by any Indian PSU

  44. Opportunities

  45. India Opportunities • Indian sedimentary basins are under explored • Huge opportunities exist in offshore / Deep-waters • Service Industry to respond to the demand • Opportunities in Oil & Gas Infrastructure • Mutually Cooperative Arrangement with Indian Companies

  46. E&P Blocks on Offer – NELP VIII

  47. Blocks On Offer - CBM-IV

  48. Areas of Cooperation - ONGC • Willing to collaborate on • E&P opportunities • Gas business • E&P infrastructure development • Potential Areas of Cooperation • E&P technology • R&D • Domain experts • Production optimization • Deepwater • New energy sources • Environment protection

  49. Thank You

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