Sell old fields and get new yields—that is the message as the government grapples with high global crude prices.
The Economic Survey called for selling old oil fields to let the private sector deploy technologies that could enhance oil recovery from the fields without raising government spending.
The international price of crude oil and petroleum products has increased phenomenally in recent months. “The crude oil price of the Indian basket touched an all-time high of $ 92.13 per barrel on November 26, 2007. This has a significant impact on the oil marketing companies and the Indian economy as India imports about 72 per cent of the crude oil requirement,” the survey said.
The government has tried to equitably distribute the burden of oil price hike among the various
Besides stepping up domestic production, the remaining deficit would have to be bridged by entering into strategic geo-political alliances to access energy assets in the region, the Survey said, pointing to the need of making investments in the energy chain in West Asia and Africa.
Admitting that the per-capita availability of energy may have remained low due to unsatisfied domestic demand, the survey has also suggested reducing incremental import dependence for the country’s long-term energy requirements. The suggestions include accelerating exploration of oil and gas.
While production from old fields have declined, the award of 162 new areas for exploration under New Exploration Licensing Policy (NELP) since 1999 have led to 46 oil and gas discoveries to add 600 million tonnes of oil equivalent hydrocarbon reserves.