India, Russia working on new energy bridge: Dharmendra Pradhan
TOI’s Sanjay Dutta caught up with Dharmendra Pradhan in Moscow where the Indian oil minister was holding the last round of Sherpa talks for the 20th bilateral summit between prime minister Narendra Modi and president Vladimir Putin at Vladivostok next week. Excerpts from the interview:
Q: What can we expect from the summit meeting between prime minister Narendra Modi and president Vladimir Putin?
A: A joint statement on comprehensive energy co-operation will be issued. A five-year complete roadmap will be signed. Several issues will be mentioned. Discussions on those are at a final stage. A new dimension is coking coal. This is at government level. MOUs will be signed at company level also. We (Indian energy delegation led by Pradhan) are preparing for it.
Q: How will it affect India-Russia relations?
A: Our energy partnership is very old and dependable. They have invested some $13 billion in India. We have invested altogether about $7-8 billion in Russia. We are going to take crude oil to India from Russia. We are also talking to further invest in their exploration sector.
We also see big prospect of Russia meeting India’s coking coal need. The Far East is their coal belt. Tata power has started investing in a coal mine. We will see SAIL, NMDC, Jindal coming here. All these companies are examining the commercial aspects of investing in the Russian Far East.
Q: Will we see energy deals being actually made at Vladivostok?
A: Several preliminary agreements, especially in oil, gas and coal, will be signed in the presence of the PM Modi and president Putin. Energy has been a major contributor in the growth of bilateral trade. Now coal and mining has been added.
Q: Has Russia offered partnership in any new oil and gas property?
A: They have made a big offer with the eastern side (identified as ‘Eastern Cluster’). This is bigger in size (than fields on offer so far), it will have greater tax rebate and the Arctic region will also be involved. There is a big possibility of an understanding being signed in the presence of the PM and president Putin. The commercial aspects are being discussed.
Q: Does this mean the talks on acquiring stake in VankorCluster will be shelved or has got stuck?
A: Those talks have neither been shelved, nor stuck. They have told us continue with this but also come into the new project. All our (oil) PSUs (public sector units) are talking to Rosneft, Gazprom and Novatek. Vankor is moving towards finality.
Q: What about the US Sanctions? Won’t they affect our ability to invest in Russian energy projects as Rosneft is under sanctions?
A: Work is being done keeping in mind all these issues. India-Russia relations are on the best of terms in their 60 years of mutual co-operation. There is a special chemistry between PM Modi and president Putin. It is a win-win deal happening. We have conceptualized an energy bridge. Economic cooperation will happen. knowledge, technology, expertise will be shared.
Q: Ujjwala was the priority in your first term as oil minister. What tops the agenda in your second term?
A: The priority in Modi 2.0 is the country’s energy independence. The strategy is to maximise domestic production by inducting new technology, new businessproposition, new economic model. To look beyond profit andrevenue and give priority to production. The focus is on raising domestic production. Take India towards gas-based economy. CGD (city gas distribution projects) is priority. PM’s strategy is to give energy justice to the common man, the poor. Affordability, accessibility, sustainability and security. Efficiency, production augmentation, conservation. All these factors are being integrated to end India’s oil dependence and take it towards oil independence. Why only Ujjwala? There will be many more Ujjwalas (schemes on such scale and philosophy).
Q: How will they change our fuel retail market?
A: Our oil companies are primarily dealing with petrol, diesel,kerosene and ATF (jet fuel). They are now slowly moving towards becoming integrated energy companies. They will retail all kinds of energy. Stress will be on alternative energy. Especially biomass. Ethanol, 2G ethanol, biodiesel and compressed biogas.
Q: Some 400 districts will soon have CGD network. A massive number of vehicles will switch to natural gas (CNG), reducing demand for petrol and diesel and sales volume of existing petrol pumps. At the same time, state-run retailers are adding about 15,000 petrol stations in an overcrowded market. Isn’t it a market overkill?
A: You are underestimating India’s energy appetite. Today, we are the world No. 3 in terms of consumption at the current level of use. But our per capita (fuel) consumption is still a third of the global average. You are forgetting the strong incremental demand, the double-digit growth, move towards becoming $5-trillion economy. How you meet the incrementaldemand? You will need more outlets to reach people. There is no overkill.