UNCLASSIFIED
PAGE 01 NEW DE 05806 211546Z
73
ACTION NEA-10
INFO OCT-01 EUR-12 ISO-00 FEA-01 ERDA-07 AID-05 CEA-01
CIAE-00 CIEP-02 COME-00 DODE-00 EB-07 FPC-01 H-02
INR-07 INT-05 L-03 NSAE-00 NSC-05 OMB-01 PM-04
USIA-15 SAM-01 OES-06 SP-02 SS-15 TRSE-00 /113 W
--------------------- 031824
R 211158Z APR 76
FM AMEMBASSY NEW DELHI
TO SECSTATE WASHDC 5420
INFO AMEMBASSY BAGHDAD
AMEMBASSY JIDDA
AMEMBASSY TEHRAN
AMEMBASSY ABU DHABI
USMISSION OECD PARIS
AMEMBASSY LONDON
AMEMBASSY ISLAMABAD
AMCONSUL BOMBAY
AMCONSUL CALCUTTA
AMCONSUL MADRAS
UNCLAS NEW DELHI 5806
DEPT PLEASE PASS TO USGS, USBURMINES
E.O. 11652: N/A
TAGS: ENRG IN
SUBJECT: MINISTRY OF PETROLEUM ANNUAL REPORT FOR IFY 1975/76
1. ACCORDING TO THE MINISTRY OF PETROLEUM'S IFY 1975-76 ANNUAL
REPORT, INDIAS POL IMPORT BILL REACHED AN ALL TIME HIGH OF
RS 11.47 BILLION DURING 1975 COMPARED TO RS 11.09 IN 1974,
PLACING A CONTINUED STRAIN ON THE COUNTRY'S BALANCE OF PAYMENTS
POSITION. SINCE 1973 CRUDE OIL PRICES HAVE INCREASED FIVE-FOLD
(IN IFY 1971-72 INDIAS OIL IMPORT BILL INCLUDING
PRODUCTS AMOUNTED TO RS 1.94 BILLION).
UNCLASSIFIED
UNCLASSIFIED
PAGE 02 NEW DE 05806 211546Z
2. TOTAL CRUDE IMPORTS DURING CY 1975 AMOUNTED TO 13.93 MILLION
METRIC TONS (MT) WITH IRAN SUPPLYING 5.85 MILLION MT (INCLUDES
2.6 MILLION MT SUPPLIED BY AMOCO AND 1.25 MILLION MT BY BURMAH-
SHELL PRINCIPALS); SAUDI ARABIA 4.18 MILLION MT
(INCLUDES 2.6 MILLION MT SUPPLIED BY EXXON AND 0.48 MILLION MT
BY CALTEX PRINCIPALS) IRAQ 2.9 MILLION MT; AND UAE 1.0 MILLION MT.
PETROLEUM PRODUCTS IMPORTED DURING THE SAME PERIOD AMOUNTED TO
2.18 MILLION MT (RS. 1.89 BILLION) DOWN FROM 2.95 MILLION
MT (RS. 2.1 BILLION) IN CY 1974 AS A RESULT OF REDUCED FURNACE
OIL IMPORTS BY 41.3 PERCENT.
3. INDEIGENOUS CRUDE PRODUCTION IN CY 1975 REACHED 8.28 MILLION
MT. OF THIS AMOUNT 5.128 MILLION MT CAME FROM ONGC'S ASSAM AND
GUJARAT FIELDS, 3.087 MILLION MT FROM OIL INDIA LIMITED (50
PERCENT GOI, 50 PERCENT BURMAH OIL) AND 68,000 MT FROM ASSAM
OIL COMPANY. BY 1978-79 INDIAS TOTAL INDIGENOUS PRODUCTION FROM
BOTH ONSHORE AND OFFSHORE OIL WELLS IS EXPECTED TO REACH 15.08
MILLION MT. STEPPING UP CRUDE OIL PRODUCTION AND ADDING TO EXISTING
OIL RESERVES CONTINUES TO RECEIVE TOP PRIORITY. THE TARGET FOR
ADDITIONAL RECOVERABLE RESERVES IS 70 TO 100 MILLION
MT BY THE END OF THE CURRENT PLAN PERIOD 1978-79.
4. INDIAS REFINING CAPACITY REMAINED UNDERUTILIZED AS A
RESULT OF THE GOI'S POLICY TO
RESTRICT CRUDE IMPORTS. TOTAL REFINERY THROUGH-PUT WAS 21.8
MILLION MT IN CY 1975 COMPARED TO AN ANNUAL CAPACITY
OF 27 MILLION MT. NEVERTHELESS, THE GOI IS GOING AHEAD WITH
PLANS TO ADD ANOTHER 10 MILLION MT OF ADDITIONAL REFINERY CAPACITY
DURING THE CURRENT PLAN PERIOD. THIS CALLS FOR A ONE
MILLION MT REFINERY AT BONGALGAON IN ASSAM, A SIX MILLION MT
REFINERY AT MATHURA IN UTTAR PRADESH AND A THREE MILLION MT
EXPANSION TO THE KK IPFINERY (PRESENT CAPACITY 4.3
MILLION MT) IN GUJARAT. WITH THE ACQUISITION OF ESSO IN MARCH
1974 AND THE TAKE OVER OF BURMAH SHELL IN EARLY 1976 THE GOI NOW
CONTROLS ABOUT 95 PERCENT OF THE PRODUCTION AND MARKETING OF
PETROLEUM PRODUCTS IN THE COUNTRY. NEGOTIATIONS ARE BEING
FINALIZED FOR THE TAKE OVER OF THE REMAINING PRIVATE SECTOR
COMPANIES -- CALTEX, ASSAM OIL CO. AND OIL INDIA LIMITED.
5. CONSUMPTION OF PETROLEUM PRODUCTS INCREASED MODESTLY BY
1.4 PERCENT TO 23.3 MILLION MT IN CY 1975. THE GOI CLAIMS THAT
UNCLASSIFIED
UNCLASSIFIED
PAGE 03 NEW DE 05806 211546Z
ALL THE ESSENTIAL DEMANDS WERE MET IN FULL. PRICES OF CERTAIN
PETROLEUM PRODUCTS WERE REVISED UPWARD IN 1975
LARGELY TO MEET THE DEMAND OF THE OIL INDUSTRY FOLLOWING THE
10 PERCENT PRICE RISE IN POL IN OCTOBER 1975. HOWEVER THE GOI
CONTINUES TO STRESS ECONOMY AND EFFICIENCY IN THE USE OF
PETROLEUM PRODUCTS.
6. COMMENT: BASED ON PROJECTED PETROLEUM CONSUMPTION OF
ABOUT 30 MILLION MT AND CRUDE OIL PRODUCTION OF 15 MILLION
MT (NEARLY DOUBLE 1975'S OUTPUT) BY 1978/79 WE SEE THE POSSI-
BILITY FOR SOME REDUCTION IN THE IMPORT DEMAND. HOWEVER, EVEN
IF INDIA SUCCEEDS IN REDUCING THE VOLUME OF ITS IMPORTS TO TOTAL
CONSUMPTION FROM ITS PRESENT TWO-THIRDS TO 50 PERCENT, THE
IMPORT BILL WILL CONTINUE TO BE STAGGERING. UNTIL THE BOMBAY
HIGH GOES ON STEAM IN MAY 1976 AND ONGC HAS HAD TIME TO STUDY
ITS CHARACTERISTICS UNDER YEAR ROUND CONDITIONS, THE PROSPECTS
OF REACHING AN ANNUAL PRODUCTION OF 10 MILLION MT FROM THIS
FIELD BY 1980 REMAINS QUESTIONABLE.SAXBE
UNCLASSIFIED
NNN