An Overview

Petrol station
A petrol station in downtown Kolkata. There are well over 30,000 fuel retail outlets all over India, the majority of which are run by public sector oil companies. Indian Oil, BPCL and HPCL had over 42,000 retail outlets on 1.4.12. Numaligarh Refinery operates ca 80 retail outlets. The private sector and multinationals (such as Esso and Caltex) were banned to operate in the fuel retail sector from 1976 till 2002. Newcomers since 2002 include Reliance (ca 1,400 outlets), Essar (ca 350 outlets) and Shell (less than 50 outlets).

India's proven, probable and possible oil reserves amount to approx. 11 billion barrels which is far from adequate for India's growing oil demand. India imports around 75 % of its total oil consumption and recent soaring oil prices have resulted in increased retail prices, which are still regulated by the central government. Public sector companies dominate the oil and gas sector. A few private sector companies such as RIL, RPL and Essar are investing heavily in the oil and gas sector. RIL's existing 34 MMTPA Jamnagar (Gujarat) oil refinery is the fifth largest in the world while RPL's new refinery, the sixth largest refinery in the world and located also in Jamnagar, was commissioned at the end of 2008. India produced 37.5 million tonnes of crude oil during 2014-15. Two-thirds of the oil produced in India's is drilled from offshore fields. Onshore oil is mainly produced in Assam and Gujarat. RIL and RPL announced a merger of the two companies in March '09. This would make the company the 13th largest oil refinerer in the world. Indian Oil, India's second largest oil refining company, is ranked 19th globally. India exported over 59 MMT of petroleum products valued at Rs 1.96 trillion (ca USD 30½ bn in 2015) ranking India as one of the largest refined oil exporting nations.

India's oil refining capacity amounted to 215 MMTPA (Million Metric Tonne Per Annum) in Apr 2014 placing India in the fourth position in the world after the United States, China and Russia. Total refined crude output was 223 million tons in 2014-15, ie over 100% of installed annual capacity. ONGC Videsh is a stakeholder in the multinational Sakhalin-I Project which now has begun the supply of oil to India. Indian state-owned oil companies have invested in oil and gas fields in a dozen foreign countries including Russia, Sudan, Iran, Iraq, Libya, Egypt, Qatar, Ivory Coast, Australia, Vietnam and Myanmar (Burma).

55 blocks (24 deep water, 6 shallow water and 25 onshore) for the exploration of oil and gas were on offer in the sixth auction under the New Exploration Licensing Policy (NELP) and are expected to bring investments to the tune of USD 8-10 billion. A total of 57 blocks are on offer on the 7th round of NELP.

Cairn Energy PLC, involved in oil exploration and production in Rajasthan (Mangala field being the largest oil discovery in India over the past two decades), is floating its Indian subsidiary Cairn India and is offtaking a 30.35 per cent share by way of a public issue.

Vizag refinery
A view of the HPCL refinery at Visakhapatnam.

Natural Gas

New gas field discoveries along the eastern coast of India could mark a significant increase in gas production and distribution. Cross-country gas pipelines are being planned and Reliance eg has applied for gas distribution licenses in 100 cities for the supply of gas to consumers. An estimated 650 bn cubic meters of gas reserves of ONGC and Reliance Industries lie untapped in the Krishna-Godavari basin. ONGC is already producing gas while RIL expects to begin gas production by mid-2008. India produced 33.66 billion cubic meters of natural gas in 2014-15, much of which was onshore.

Oil Refineries

India has 18 public sector refineries and five refineries in the private sector/or as a joint venture, the largest refineries being RIL Jamnagar (Gujarat), RPL Jamnagar (Gugarat), MRPL Mangalore (Karnataka), CPCL Manali (Chennai, Tamil Nadu) and IOC Koyali (Gujarat). Three new refineries have been proposed for implementation at Paradip (Orissa), Bina (Madhya Pradesh) and Bhatinda (Punjab). Essar Oil operates a 10.5 MMTPA refinery at Vadinar, Gujarat. RIL's and RPL's two refineries at Jamnagar have a total capacity of 1.24 million bpd, making these the world's largest combined oil refining facility. Indian Oil's Digboi (Assam) refinery, Asia's first, along with its oil field is the oldest refinery and continously operating oilfield in the world after being in operation since 1901. Total crude oil processed during 2013-14 reached 223 MMTPA. Exports amounted to 68.4 MMTPA of various petroleum products valued at Rs 3.71 trillion.

Proposed/Under Construction Grassroots Refineries
LocationStateCapacity (MMTPA)CompanyMajor StakeholdersMiscStatus
BhatindaPunjab 9 (currently being expanded to 11½) HPCL- Mittal Energy Ltd. HPCL and Mittal Energy Investment Pte Ltd - Singapore 165MV captive power plant, 1012 km pipeline to Mundra, Gujarat Operating since Mar '12
VisakhapatnamAndhra Pradesh15HPCLTotalExpansion of current Vizag refinery
BinaMadhya Pradesh6Bharat Oman Refineries Ltd BPCL and Oman Oil Company LtdA 935 km crude oil pipeline from Vadinar, Gujarat to Bina, MP 85 % completed - Jan '09. Completion 2009-10.
BarmerRajasthan7.5Rajasthan Refineries LimitedONGC and Cairns EnergyThe Rs 90 bn project would be Rajasthan's largest single investment. This project has been put on hold.
KakinadaAndhra Pradesh 14 Mangalore Refinery (ONGC subsidiary) Mangalore Refinery, IL&FS, Andhra Pradesh Govt. Export oriented refinery-cum-petrochem complex, planning stage.
ParadipOrissa5Indian OilIndian OilA 15 MMTPA refinery-cum-petrochem complex slated to be completed by end 2011.
JamnagarGujarat 29 Reliance Petroleum Ltd. RPL A 29 MMTPA export-oriented refinery commissioned in Dec 2008.
VadinarGujarat ca 24 Essar Capacity expansion of current refinery to 34 MMTPA by Dec 2011.

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