This thesis provides the background to and an analysis of the economics of exploring for and developing oil and gas discoveries in India. It is aimed at helping the oil and gas industry assess the financial attractiveness of investment in that country. The thesis describes the geography, climate, infrastructure, and energy market with an emphasis on how these affect upstream oil and gas industry investment. A detailed description and analysis is given of the petroleum production sharing contract ("PSC") terms embodied in India's New Exploration Licensing Policy ("NELP"), and demonstrates that, depending on negotiations, Government Take under NELP terms is likely to be in the range 50% to 60% for a stand-alone petroleum development. However, PSC terms are regressive for marginal discoveries. In particular, State royalties might hinder the development of small or marginal discoveries and render them uneconomic. As an illustration, depending on the oil price, up to 6 MMbbls of oil in otherwise economically viable small fields in a geological basin might be made uneconomic and left stranded because of the effect of royalties. The thesis also analyses the economics of developing a sample of actual Indian oil and gas fields offshore the east and west coasts of the country in shallow and deep water. Onshore field developments are not analysed because of lack of data. All of the offshore developments analysed are profitable based on past and current economic conditions and knowledge. The majority are also relatively low-risk investments. Finally, the thesis evaluates the profitability of new oil and gas exploration and development offshore the east and west coasts of India. The required minimum size of new exploration prospects are in the range 10 to 17 MMbbls for oil prospects and 138 to 1,100 Bcf for gas prospects assuming a low probability of success. Once a new discovery is made, the required minimum economically developable reserves are 4 to 12 MMbbls for oil discoveries and 63 to 1,400 Bcf for gas discoveries.
| Identifer | oai:union.ndltd.org:ADTP/187049 |
| Date | January 2005 |
| Creators | Venugopal, Sajith, Petroleum Engineering, Faculty of Engineering, UNSW |
| Publisher | Awarded by:University of New South Wales. School of Petroleum Engineering |
| Source Sets | Australiasian Digital Theses Program |
| Language | English |
| Detected Language | English |
| Rights | Copyright Sajith Venugopal, http://unsworks.unsw.edu.au/copyright |
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