India Oil & Gas Industry Report - H2, 2012

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India Oil & Gas Industry Report - H2, 2012

India's oil and gas sector is highly regulated by the Ministry of Petroleum and Natural Gas. The ministry influences exploration, production, distribution, marketing of companies in the sector. It also has a hand in the pricing of oil, natural gas and petroleum products to some extent. Despite the tight regulation, however, the private sector plays a major role, particularly in the downstream business.

India was the fourth largest consumer of oil and petroleum products in 2011, after the United States, China and Japan. To satisfy demand, Indian upstream oil companies have acquired stakes in overseas assets. Existing domestic oil reserves and production is insufficient to meet the demand in India. More than 80% of India’s crude oil demand was met through imports as of FY12.

The sector also acts as a major source of tax revenue generation for India’s central and state governments. Prices of many oil, natural gas and petroleum products are controlled by the central government. This sometimes forces downstream companies to sell finished products at unprofitable prices. Government subsidies partially cover the shortfall, but this puts a strain on central government finances and bloats the fiscal deficit. In FY13, the government instituted a slew of reforms geared toward reducing the subsidies, such as limiting the number of subsidized cylinders and incremental decontrol of diesel prices. These moves are expected to improve the earnings of industry operators in the coming quarters.

During FY13, Indian crude oil and natural gas (upstream) production declined. However, refining and other downstream activities registered positive growth. India’s growing energy requirements and rising per capita consumption, combined with the phasing out of subsidies and decreased regulatory uncertainty, bode well for the sector.

Key Points:

• During the first 10 months of FY13, total crude oil production was 0.4% less than that the same period last year. Production was also 4.7% lower than targeted for the period.

• During the first 10 months of FY13, total natural gas production was around 16% less than the same period last year. However, the production was 0.3% higher than projections for the period.

• India’s crude refining throughput grew at a CAGR of 7.5%, reaching 211 MMTPA in FY12. In the first 10 months of FY13, total crude throughput grew by 7.3% over the same period last year.

• Crude oil production has a weighting of 5.22% in the IIP, while natural gas production and refinery products have a weighting of 1.71% and 5.94%, respectively. Both crude oil and natural gas production (i.e. upstream business) slipped in the second half of FY13. The downstream segment registered a resilient growth during this period.

Table of Contents

1. Industry Profile
1.1 Sector overview
1.2 Sector size
1.3 Competitive landscape
1.4 Environmental scanning

2. Market Trends and Outlook
2.1 Key economic indicators-India
2.2 Reserves and exploration
2.3 Production trends
2.4 Refining
2.5 Consumption
2.6 Trade
2.7 Price
2.8 Under recoveries

3. Leading Players and Comparative Matrix
3.1 Leading players
3.1.1 Oil & Natural Gas Corporation Ltd (ONGC)
3.1.2 Indian Oil Corporation Ltd (IOCL)
3.1.3 Reliance Industries Ltd (RIL)
3.2 Comparative matrix
3.3 SWOT analysis

4. Tables and Charts

Table 1: Highlights of Kelkar committee report on fiscal consolidation-oil subsidies
Table 2: Major oil & gas basins in India
Table 3: Balance sheet parameters
Table 4: Valuation matrix

Chart 1: Annual crude refining throughput-India
Chart 2: Share of installed refining capacity as of FY12
Chart 3: Share of companies by installed crude refining capacity
Chart 4: Share of companies in terms of crude oil production
Chart 5: Breakup of total energy consumption in India
Chart 6: Imports of crude oil by source
Chart 7: Gross domestic product from oil and natural gas sector
Chart 8: Breakup of oil and sector revenues to Central/State Governments
Chart 9: Breakup of total Central Government subsidies
Chart 10: Trade deficit of India
Chart 11: India's top oil and gas companies by net sales
Chart 12: Breakup of cumulative grid deployment of renewable energy sources
Chart 13: Position of constituent parties in lower house of parliament
Chart 14: Current account deficit and fiscal deficit
Chart 15: Oil consumption per capita
Chart 16: Quarterly GDP growth rate-India
Chart 17: Average Monthly USD to INR Exchange Rate
Chart 18: Production of major petrochemicals in FY12 in thousand metric tons
Chart 19: Index of industrial production
Chart 20: Y/Y change in index of industrial production
Chart 21: Recoverable oil and natural gas reserves in India
Chart 22: Ratio of onshore and offshore crude oil reserves
Chart 23: Ratio of onshore and offshore natural gas reserves
Chart 24: Share of companies in Indian oil and gas fields
Chart 25: Status of wells in India
Chart 26: Crude oil production in India
Chart 27: Crude oil production in India by states
Chart 28: Crude oil production by companies
Chart 29: Onshore and offshore crude oil production proportion of companies
Chart 30: Annual natural gas production in India
Chart 31: Share of natural gas production in India by companies
Chart 32: Natural gas production by companies
Chart 33: Onshore and offshore natural gas production proportion of companies
Chart 34: Production of refined petroleum products
Chart 35: Share of private sector players in refinery crude throughput
Chart 36: Share of crude throughput in the country
Chart 37: Capacity utilization of refiners
Chart 38: Deficit between production and consumption of crude oil in India
Chart 39: Surplus recorded in production of petroleum products
Chart 40: Net imports of crude oil in value terms
Chart 41: Net exports of petroleum products in value terms
Chart 42: Annual average price of crude oil
Chart 43: Monthly average price of crude oil
Chart 44: Under recoveries of OMCs on kerosene and domestic LPG
Chart 45: Share of under recoveries of OMCs by product category
Chart 46: Annual production of ONGC
Chart 47: Subsidies borne by ONGC over the years
Chart 48: Profit margin of ONGC
Chart 49: Annual crude throughput of IOCL and its subsidiaries
Chart 50: Annual turnover of IOCL
Chart 51: Net under realizations of IOCL over the years
Chart 52: PAT Margin of IOCL
Chart 53: Segment wise revenues of RIL
Chart 54: Annual turnover of RIL
Chart 55: Gross refining margins of Indian refiners
Chart 56: Profit margins of RIL

Number of pages: 39
Release Date: Mon, 22 Apr 2013