Source: IEA World Energy Outlook 2009
The west may be paying little heed to China’s grab for assets, including crude oil and gas, but India certainly is – in fact, it is considering competing more directly with China on securing more resources.
Chinese companies have made numerous oil and gas purchases in the past year alone, The most recent example is Cnooc’s $3.1bn investment in Argentina’s Bridas. There have also been bilateral loans-for-oil agreements, such as a $10bn deal with Brazil last May.
India’s state-controlled oil companies have made plenty of overseas investments in recent years, as ONGC Videsh’s assets lists show.
But ONGC’s chairman, R S Sharma, wants a more explicit efforts from the government, in the form of a sovereign wealth fund, and as the FT reports, such a move looks possible:
The discussions under way between the oil and finance ministries to set up a sovereign investment fund were at an early stage, the officials said, and no deadline had been set.
The plan, if adopted, would repudiate an initiative pushed by New Delhi in 2006 for India to join forces with China in bidding on global energy projects to keep costs down.
Interestingly many of China’s biggest oil and gas asset deals have been done by PetroChina and Cnooc rather than the SWF fund China Investment Corporation, or directly by government. India was also just last week building ties with Saudi Arabia, which committed to double its crude oil shipments to India. But with India’s high reliance on imported oil (running at about 75 per cent currently) and growing demand, it seems the country is keen to step up its efforts further.
Related links:
A continuing refining headache (FT Energy Source)
Russia, Saudi Arabia and the Indian oil trajectory (FT Energy Source)
