Global oil majors look to invest big in Indian oil and gas companies

Even as the government focuses on reducing the country's reliance on fossil-fuel, global oil majors continue to see India as an expanding market as they expect tremendous growth in the energy demand here.

On Monday, Saudi Aramco announced that the company through its subsidiary Aramco Asia India (AAI) would invest in the downstream oil and gas sector in India through a joint venture. Aramco India is planning to expand its operation in India through an integrated business venture including hydrocarbon sector servicing, IT and R&D.

At a petroleum summit in Delhi, Amin Nasser, CEO, Saudi Aramco, showcased his company's will to invest big in India stating that India's consumption of crude oil has increased from 4.6 million barrels per day to 10 million barrels per day by 2040.

Earlier, Russian oil major, Rosneft and its partners stuck a $12.9 billion deal to buy 98% stake in Essar Oil. The deal will help Rosneft improve its fuel supplies efficiency in the Asian region.

In July, BP and Reliance agreed to develop ‘R-Series’ deepwater gas fields in India and expand partnership in the downstream sector and in other areas including differentiated fuels, mobility. The two companies have submitted a development plan for Government approval, which is due by the end of 2017. The project, which requires a total investment of Rs 40,000 crore, is expected to yield 30-35 million cubic metres of gas a day in a phased manner by 2020-2022.

Also on Monday, Prime Minister, Narendra Modi interacted with chiefs of oil and gas companies and expressed government's intention to revive private investment in domestic oil and gas production and thereby reduce oil imports.

With government's push and private investments, Indian downstream oil companies, as well as gas carriers, are expected to get the required capital inflow to invest in new explorations and expansion of existing production.

Among oil and gas stocks, Reliance Industries was trading at Rs. 841.95 per share, up by 11.30 points or 1.36%; Oil India was trading at Rs. 349.10, higher by 4.25 or 1.23%; ONGC was trading at Rs. 170.05, lower by 0.65 points. Petronet LNG was trading at Rs. 246.55, up 5.00 points or 2.07%, Indraprastha Gas was trading at Rs. 1,472.50, higher by 30.45 points or 2.11%, while GAIL was trading lower at Rs. 445 per share, down by 1.05 points close to its 52-week high.