Moily says no need for IMF loan; TAPI consortium to be in place soon

The 1,735-km TAPI pipeline will have a capacity to carry 90 mscmd of gas for a 30-year period

With the outlook for Indian economy looking significantly better than what it used to be in mid-2013, Petroleum Minister M Veerappa  Moily on Tuesday said there was no need for India to seek loans for oil imports.

“The economy is doing well and current account deficit concerns have eased. There is no need to seek loans,” Moily told Business Standard.

Moily was responding to media reports that India might have to seek loans from the International Monetary Fund (IMF) to import oil. Petroleum Secretary Vivek Rae had said oil shocks in the past had forced India to take loans from IMF. Rae, however, said on Tuesday oil subsidies were a concern but the situation was not that bad.

India Ratings, in a report released on Tuesday, also said better-than-expected monsoons, rising exports, swift policy as well as project clearance actions by the government and deft currency management by the Reserve Bank of India (RBI) have improved business sentiments.

“The most noteworthy turnaround has been witnessed in the case of current account deficit which is likely to settle at around 2.2 per cent of the GDP in both FY14 and FY15. This will support the rupee which is likely to appreciate from the current levels to $56-57 by end-March 2015,”  the report said.

In the second quarter of 2013-14, the Indian economy was struggling with current account and fiscal deficits, falling rupee and high and stubborn inflation.

TAPI pipeline: An international consortium to operate a $7.6-billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline would soon be in place. The project is expected to be operational by 2017-18. The 1,735-km TAPI pipeline will have a capacity to carry 90 million metric standard cubic metres a day (mscmd) of gas for a 30-year period. “The TAPI gas pipeline is in the process of choosing the consortium for building the pipeline. Once the consortium is chosen the pipeline will be built by 2017-18. By August 2020, India will have TAPI gas,” said Moily.

The pipeline has the backing of the Asian Development Bank. “In three months, a consortium leader will be appointed,” Moily said at Petrotech.

India and Pakistan would get 38 mscmd each, while the remaining 14 mscmd will be supplied to Afghanistan. The pipeline will start from the Dauletabad gas fields and run into Afghanistan. The final destination of the pipeline will be Fazilka near the India-Pakistan border. Also, to help India’s shale gas ambitions, Canada has said it would provide technology for fracking to India.

“Canada has said it will provide fracking technology to India. Indian companies, including IndianOil and GAIL, are seeking opportunities in the oil and gas sector.”

Currently, IOCL was pursuing discussions for LNG offtake from Canada, Moily said.

BILATERAL AGREEMENTS ON DAY 3

• The premier of the Province of Alberta, Canada, is expected to offer Indian upstream companies state-of-art fracking technologies, to develop the potential of shale in this country
  

 

In exchange, more of Indian oil & gas companies will increase their investments and presence in the Canadian hydrocarbon sector A term contract for Canadian crude is under finalisation by Indian Oil Corporation (IOC)
 

A joint Indo-Ugandan working team is under formation to look into opportunities for cooperation in the newly opened Ugandan hydrocarbon sector
 

Azerbaijan invited upstream Indian companies to participate in their oil & and gas industry and enable skill development in the new country
 

IOC also has a term contract for Azeri crude also, while BPCL and HPCL were also keen to enter term contracts for sourcing crude oil from Azerbaijan