Download Its our turn now!

www.pwc.com
It's our turn now!
The energy security imperative
December 11, 2012
11th Petro India
Agenda
Page
1
Energy is economic insecurity
1
2
Industry Captains views
5
3
The ask
8
It's our turn now! • The energy security imperative
PwC
December 11, 2012
Section 1
Energy is economic insecurity
It's our turn now! • The energy security imperative
PwC
December 11, 2012
1
Section 1 – Energy is economic insecurity
Hydrocarbon sector can make or mar the economy
50%
54%
Oil imports as a % of India’s total
exports
118
Oil trade deficit as a % of India’s
total trade deficit
Weakening of the Rupee
110
119
85
89
59
INR
185
Oil trade deficit and non-oil trade deficit (in
billion USD)
14
28
17
-3
23
5
46
14
32
37
52
54
51
21
38
51
66
59
65
99
$12.8 Drawdown of foreign exchange to
the tune of 12.8 billion USD
bn.
Oil trade deficit
Non Oil trade deficit
Total Trade deficit
17 MMT additional domestic production would have avoided the drawdown
It's our turn now! • The energy security imperative
PwC
December 11, 2012
2
Section 1 – Energy is economic insecurity
Rather than for securing energy sources, energy
security seems more compelling for economic reasons …..(1/2)
~ 6.5% of current
aggregate GDP
124.6 bn USD
of value
generated
Import of 169.7
million tonnes of
crude oil
Had India been
import free
9.4 million
person years
of
employment
It's our turn now! • The energy security imperative
PwC
~ 0.5 mn person years of
employment annually i.e.
over thrice the current
petroleum sector
employment in India
December 11, 2012
3
Section 1 – Energy is economic insecurity
Rather than for securing energy sources, energy
security seems more compelling for economic reasons….(2/2)
40%
Scenario 1
Gross value
added
32.2 bn USD
GVA as a % of
aggregate GDP
1.6%
Economy
\of Cyprus
today
1.62
50%
Output multiplier Scenario 2
for crude
petroleum
47.2 bn USD
2.3%
77.3 bn USD
It's our turn now! • The energy security imperative
PwC
3.8%
~ 0.125 mn person
years annually ›
thrice the current
E&P sector
2.5 mn person
employment
in India
years
Govt. take in
USD billion
8
Economy
of Kenya
today
~ 0.19 mn person
years annually ›
current Petroleum
3.7 mn person sector employment in
years
India
12
Economy
of
Bulgaria
today
~ 0.31 mn person
years annually ›
twice the current
6.1 mn person Petroleum sector
employment in India
years
20
70%
Scenario 3
Employment
generated
December 11, 2012
4
Section 2
Industry Captains views
It's our turn now! • The energy security imperative
PwC
December 11, 2012
5
Hydrocarbon and beyond: Changing landscape
Petrotech Society and PwC administered a survey.
Fuel for thought
Senior management survey, October 2012
PwC
Section 2 – Industry Captains views
PwC-Petrotech survey “Fuel for thought” in October 2012 is a
reflection of direction desired
rich in hydrocarbon
60%
India is
and ……, our primary focus should
be on promoting investments in the domestic E&P sector.
95%
increased
India’s energy security challenge.
88%
the country’s energy
meet the energy security challenge.
96%
stability in policies is a must to encourage companies to adopt
private sector participation can help address
policies need to be more aligned to
expensive cutting edge technology in India.
It's our turn now! • The energy security imperative
PwC
December 11, 2012
7
Section 3
The ask
It's our turn now! • The energy security imperative
PwC
December 11, 2012
8
Section 3 – The ask
In an evolving sector, disclarity is not unexpected.
Purpose is to deal with it expeditiously.
Arms length price discovery: participant sectors
Term extension in producing blocks
Royalty: post well head costs
Well wise accounting: Retrospective withdrawal
…………………………………..
It's our turn now! • The energy security imperative
PwC
December 11, 2012
9
Section 3 – The ask
A focussed E&P sector growth will not only provide fule
but life to economy.
It’s our turn now
E&P partnership for energy security
• Growth beyond marginal or organic levels
• Objectives drive policies
• Matching Norway & Brazil like monitoring
• Partnerships of stakeholders
• .... During long journey, have gas imports
It's our turn now! • The energy security imperative
PwC
December 11, 2012
10
Thank you
The information contained in this document is provided 'as is', for general guidance on matters
of interest only. PricewaterhouseCoopers is not herein engaged in rendering legal, accounting,
tax, or other professional advice and services. Before making any decision or taking any
action, you should consult a competent professional advisor.
© 2012 PricewaterhouseCoopers Private Limited. All rights reserved. In this document, “PwC”
refers to PricewaterhouseCoopers Private Limited (a limited liability company in India), which
is a member firm of PricewaterhouseCoopers International Limited, each member firm of
which is a separate legal entity.