{{East Africa’s oil and gas prospects continue to attract attention from around the globe, with India becoming the latest to express interest in the region’s oil resource.}}
Mr Ravi Bangar, the joint secretary, Eastern and Southern Africa, ministry of External Affairs, India told Prosper on the sidelines of the 9th Confederation of Indian Industry (CII) – Exim Bank India-Africa partnership recently that India plans to become active in East Africa’s upstream and downstream oil sector as it seeks to meet its refining capacity.
The upstream oil sector includes exploration and production of oil and gas while downstream involves the refining of petroleum crude oil, processing and purifying of raw natural gas as well as the marketing and distribution of products derived from crude oil and natural gas.
Oil and gas discoveries in Uganda and Kenya have attracted interest from Tullow Oil – a UK based firm, France’s oil major Total and Chinese CNOOC among others.
Uganda has an estimated oil resource of about 3.5 billion barrels, while Kenya recently discovered oil in the Turkana.
Venturing into the East African region will add the two East African countries to the likes of Nigeria, Angola, Algeria, Egypt, Cameroon, Equatorial Guinea and Sudan, where India imports crude oil to meet its increasing oil and gas demands.
India is the fourth largest oil importer, with oil and gas constituting 45 per cent of the country’s primary energy basket.
About 78 per cent of India’s petroleum consumption is met from crude oil imports, while about 25 per cent of natural gas consumption also comes from imports.
India has the biggest oil refineries in the world, with an installed capacity of 668,000 barrels per day, located in the oil complex of Jamnagar in western Gujarat but currently refines 27 million tonnes per anum or 540,000 barrels per day.
The high crude oil exports are said to have increased trade between Africa and India, with Africa’s exports to India estimated at $43 billion last year while India’s exports to Africa were valued at $23 billion.
As Africa’s economic development gains momentum and its energy demands are on the increase, India is also poised to become a dependable supplier of petroleum products to Africa.
The country’s refining capacity is set to increase from the current 194 million tonnes per annum to 238 million tonnes by the end of this year.
This means an additional need of 40 million tonnes of crude per annum. Africa, which has limited refining capacity, provides market for India’s booming petroleum exports.
India exported 50 million tonnes of refined petroleum products during 2010/11 valued at about $40 billion.
NMG
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