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Manish Maheshwari, CEO of E&P at Essar Oil, on India achieving energy self-sufficiency by 2030

09th December 2014

Manish Maheshwari, CEO of E&P at Essar Oil talks to OGT about India's plans to meet its growing energy demand with domestic supply

Manish Maheshwari, newly appointed CEO-E&P at Essar Oil, talks exclusively to Oil & Gas Technology about how Essar Oil and other Indian exploration and production firms are hoping new technology, unconventional resources and an improved regulatory framework will allow India to feed its growing energy demand and meet its ambitious target of energy independence by 2030

Interview: Manish Maheshwari, CEO of E&P at Essar Oil
'The government has articulated the vision for the country to become fully self-sufficient of its energy demand by 2030. This objective cannot be called easy, however it must not be termed impossible'

How would you describe the current health of India’s exploration and production sector?

India imports 80 per cent of its crude oil requirement.

The import bill towards this commodity has significant bearing on the macro-economic pulse of our country, affecting the fiscal deficit, the currency stability and inflation.

A recent analysis by E&Y indicates that India’s GDP can increase by a whopping 6.5 per cent if the import of crude oil were to be avoided completely.

The government has articulated the vision for the country to become fully self-sufficient of its energy demand by 2030. This objective cannot be called easy, however it must not be termed impossible.

Spotlight needs to be on the exploration and production sector.

We have inspiring examples like Norway and Brazil, where strategic and focussed vision for the domestic exploration and production sector saw these nations race ahead in the global energy space. Norway, from being nowhere on the global exploration and production map in the 1970s, is today counted among the top 10 hydrocarbon producing nations of the world. On the back of stable policy implementation and persistent efforts, Brazil has more than doubled its oil reserves every 10 years consistently over the last three decades.

Likewise, in order for India to become self-reliant for its energy needs, the exploration and production sector would need a policy and fiscal impetus. 

Besides the attendant sub-surface risks, the exploration and production sector is capital intensive. Typically, the main barrier to attracting investments has not been the geology of a country but its policies and regulations. Day-to-day regulations and long-term uncertainty definitely combines the worst of both worlds. We do recognise that the present government has been actively engaged in addressing these issues. The industry is expecting the government to usher in policies which encourages an integrated approach across conventional and unconventional plays to explore, develop and produce hydrocarbons in a responsible manner.


In which direction do you intend to steer Essar Oil’s exploration and production in India?

Our portfolio of assets has in aggregate 1.75 billion barrels of oil equivalent of reserves and resources. The singular objective is to transform theses ‘reserves-under-the-ground’ to ‘production’ and ‘cash streams’. We are well positioned to deliver this objective in a safe, cost effective and time efficient manner.

In India, we enjoy a leadership position in coal-bed methane (CBM), with an acreage of approximately 2,700 square kilometres spread across the prolific Gondwana Basin. Indeed, we are progressing well on the development of our Raniganj CBM asset.

We have a positive bias towards the unconventional plays as we have reasons to believe that these plays hold the potential to help our nation get to the goal of energy self-sufficiency. Besides CBM, as a group we are poised to pursue the shale opportunity as and when the government allows the private participation.


What are the most promising areas of exploration in India?

Of approximately 3.1 million square kilometres of sedimentary basins in India, only 0.84 million square kilometres is under exploration, development or production pursuant to either PEL or PML.

This represents just 25 per cent of the total sedimentary basins in India.

Our basins thus remain either un-explored or poorly explored. Likewise, in the CBM play, as a nation though we have prospective resources in excess of 40 trillion cubic feet (tcf), only a miniscule percentage of less than 1 per cent is under active development.

Likewise, the shale potential is yet to be tapped. All this presents a huge opportunity for the exploration and production players - both domestic and international.


How has technology enabled the success of these plays?

In our quest for discovering new hydrocarbon accumulations, technology has been a constant companion. Technological advancements in the domain of imaging, mapping, directional drilling, logging, metallurgical and construction engineering etc. have allowed the Industry to discover, develop and produce hydrocarbons in the most of trying environments from the sub-zero to burning hot terrain and from onshore to ultra-deepwater settings.

We have live examples in India where extended reach wells with horizontal section running up to 1,000 metres have been drilled, successfully overcoming the excessive torque and drag exerted during such sections.

Use of multifinger imaging tools, high resolution laterolog, flow scan imager, advance remote sensing based on thermal imaging for direct hydrocarbon indicators (DHI) have been successfully applied in several geological provinces in India.


What would enable further output growth in India? New technology? Legislation?

An integrated policy which is rich in content and clear on intent is needed to catalyse the upstream sector.

For achieving the self-sufficiency goal by 2030, it is imperative that the government restores the confidence of the investors. As a class, the investors in the exploration and production sector are attuned to dealing with the geological risk but, for sure, not the uncertainties associated with the regulatory environment.

Our production sharing contracts are not broke; perhaps the processes need to be untangled with a view to encourage exploration and production activities keeping the over-arching goal of energy security and self-sufficiency in consideration. 


Where will new technologies come from? Developed and manufactured domestically or abroad?

Access to technology has not been a constraint. Players in the Indian exploration and production sector are quite enterprising to source technology most apt to the situation.

At the end of the day, the source of technology is not what matters but it is the relevance and application which yields the end results. 


How is Essar meeting India’s energy demand by investing in foreign exploration and production developments?

Essar Group has a portfolio of exploration and production assets located across several countries. 3D seismic data has been acquired in most of the blocks and the interpretation establishes significant resource base. Under a success leg, with these discoveries coming on stream, the group shall be able to add to India’s foreign equity oil.

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