Indian oil business on the lookout for Norwegian technology

A desperate need to cover the explosive growth in domestic energy consumption is about to force Indian authorities into deep water looking for new hydrocarbon reserves. Norway is one of the models they look to when organizing the Indian oil business.

Published: 4 May 2007
- The Indian Oil directorate is modelled on its Norwegian equivalent, as a result of a close cooperation between Director of Oil, Gunnar Berge, and his Indian counterpart. Now the national authorities are hoping to extend cooperation with the Norwegian oil industry, Per Reinboth, leader of Innovation Norway's New Delhi office, told the around fifty potential technology exporters who had found their way to the information meeting on India and Malaysia this week. The meeting was a joint initiative by NCE Subsea, Innovation Norway and Bergen Chamber of Commerce and Industry, whereas Hordaland Oil and Gas, Vest Næringsråd (Chamber of Commerce and Industry), Stord Næringsråd (Chamber of Commerce and Industry) and Nordhordaland Handcraft and Industry are co-organizers.
Identify area
The official top-level cooperation has resulted in Norway being mentioned as an ideal collaborate in the Indian Oil and Gas department's current 5-year plan. Although Indian law allows free establishment of private and international companies, much of the offshore activities are regulated by the government's 5-year plans.
- The potential for Norwegian subsea technology in India is huge. The situation indicates that it is more a question of who wants in than who will be allowed. This despite the severe competition for orders in the private sector, said Reinboth.
- NCE Subsea members should identify areas in which they wish to cooperate, and test the result in India, Innovation Norway's representative in New Delhi recommends.
Norwegian competence has aroused considerable interest particularly in the area of HSE. Education on the area hardly exists in India today. The Indian oil directorate has specifically expressed their interest in a collaborate who will approach the problem in its entire breadth, related to the particular challenges involved in searching and production on deep sea.

Increased extraction in mature fields is another important issue. The aim, according to Reinboth, is to increase the average degree of extraction from 30 to 40 per cent.
The world's largest gas field
The world's largest gas field in deep water so far was discovered in 2002 on the Indian shelf. The field is believed to contain more than 1,6 trillion cubic metres of gas and lies on 1,700 - 1,800 metres' depth. By end 2008 the privately owned oil company RIL will have established a production plant that can extract as much as one million cubic metres of gas per day.
- India has great potential for finding petroleum resources on ocean depths down to 3000 metres. However, the country wants the necessary technology to meet the challenges involved in searching and development at such depths. This despite the fact that they have considerable experience in more shallow waters, said Reinboth.
Extensive search program
The country faces an extensive charting and searching programme that to a great extent will take place at great depths. Less than 20 per cent of the more than three million square kilometre Indian continental shelf is explored, charting petroleum resources. Estimates say that less than 30 per cent of the resources are located. Low drilling activity and relatively many dry search wells have not improved the situation.
- There will be grounds for billion-kroner seismic contract awards, claims Innovation Norway's New Delhi representative.
Prognoses estimate that 250 search wells will be drilled in deep sea towards 2012. The same amount is likely to be drilled in shallow waters.
Norwegian business actors
Several Norwegian actors have already set up business in India. The major Norwegian oil companies, however, are conspicuous by their absence.
- Statoil and Hydro are important actors who could have contributed positively to the export of Norwegian subsea technology, because they would have brought many of their subcontractors with them. It is much more difficult for smaller Norwegian actors to find their way on their own. However, the presence of Aker Kværner Subsea and FMC Technologies will help establishing more Norwegian companies in India. They have sufficient weight to suggest concrete projects to Indian oil companies, Reinboth indicates.
Financing is not a problem for Norwegian companies wishing to set up business in India. Operating the system seems to be the biggest challenge.
A complicated state administration will effectively stop the impatient, Reinboth believes.
Patience and presence
- Patience is first priority for Norwegian companies wishing to do business in India, said ClampOn sales manager, Olav Brakstad.
-Local presence, by means of a clever local partner with the ability to find the way through the system is decisive for success.
English text by Trude Sletteland