Nearly three months after Prime Minister Narendra Modi and US President Donald Trump agreed to enhance energy cooperation through Strategic Energy Partnership, India on Monday received its first ever consignment of crude oil from America ever since it had stopped oil exports to New Delhi in 1975.
The first consignment of the US crude oil cargo of 1.6 million barrels bought by Indian Oil Corporation was received at the Paradip Port in West Bengal. A sample of the crude was symbolically presented to Sunjay Sudhir, Joint Secretary (International Cooperation) in the Ministry of Petroleum and Natural Gas. Katherine B Hadda, US Consul General in Hyderabad, senior officials from Ministry of External Affairs and Indian Oil were also present at the ceremony. The consignment was brought by MT New Prosperity, a Very Large Crude Carrier (VLCC). IOC will process the crude at its East-Coast base refineries, located at Paradip, Haldia (both West Bengal), Barauni (Bihar) and Bongaigaon (Assam). The second shipment is expected in a month's time.
Calling it as a new chapter in the history of Indo-US trade, particularly in the oil and gas sector, Sudhir said that the inclusion of the US as a source for crude oil imports by India's largest refiner will go a long way in mitigating the risks arising out of geo-political disruptions. He added that the new arrangement would also usher in price stability and energy security for India, which is witnessing robust growth in demand for petroleum products.
"This is one of the first shipments to India since the US stopped oil exports in 1975, and follows recent commitments to US oil purchases by IOC and Bharat Petroleum (BPCL)… These crude oil shipments to India have the potential to boost bilateral trade by up to $2 billion," the US embassy in New Delhi said in a statement.
IOC, which became the first Indian public sector refiner from India to source US crude, has placed a cumulative order 3.9 million barrel from the US. Bharat Petroleum and Hindustan Petroleum, India's two other public sector refiners have also placed orders for about 2.95 million barrels and 1 million barrels, respectively, for their Kochi and Vishakhapatnam refineries. The total volume of the crude presently contracted by Indian public sector refineries with US is 7.85 million barrels.
Indian companies, both public and private, have made sizeable investments in US Shale assets with a total investment of approximate $ 5 billion. Indian companies have also contracted MMTPA of LNG from the US and the first shipment is expected to be delivered to India in January 2018.
"This event marks a significant milestone in the growing partnership between the US and India. The US and India are elevating our cooperation in the field of energy, including plans for cleaner fossil fuels, renewables, nuclear, and cutting edge storage and energy efficiency technologies. We look forward to working together on further sales of U.S. crude and exploring opportunities to expand the role of natural gas in India," said Mary Kay Carlson, Chargé d'Affaires at the US Embassy in New Delhi.
During their June 26 meeting in Washington, Modi and Trump committed to expanding and elevating bilateral energy cooperation through a Strategic Energy Partnership. The leaders called for a rational approach that balances environment and climate policy, global economic development, and energy security needs. Trump affirmed that the US continues to remove barriers to energy development and investment in the US and to US energy exports so that more natural gas, clean coal, and renewable resources and technologies are available to fuel India's economic growth and inclusive development, the US Embassy said.
The first consignment of the US crude oil cargo of 1.6 million barrels bought by Indian Oil Corporation was received at the Paradip Port in West Bengal. A sample of the crude was symbolically presented to Sunjay Sudhir, Joint Secretary (International Cooperation) in the Ministry of Petroleum and Natural Gas. Katherine B Hadda, US Consul General in Hyderabad, senior officials from Ministry of External Affairs and Indian Oil were also present at the ceremony. The consignment was brought by MT New Prosperity, a Very Large Crude Carrier (VLCC). IOC will process the crude at its East-Coast base refineries, located at Paradip, Haldia (both West Bengal), Barauni (Bihar) and Bongaigaon (Assam). The second shipment is expected in a month's time.
Calling it as a new chapter in the history of Indo-US trade, particularly in the oil and gas sector, Sudhir said that the inclusion of the US as a source for crude oil imports by India's largest refiner will go a long way in mitigating the risks arising out of geo-political disruptions. He added that the new arrangement would also usher in price stability and energy security for India, which is witnessing robust growth in demand for petroleum products.
"This is one of the first shipments to India since the US stopped oil exports in 1975, and follows recent commitments to US oil purchases by IOC and Bharat Petroleum (BPCL)… These crude oil shipments to India have the potential to boost bilateral trade by up to $2 billion," the US embassy in New Delhi said in a statement.
IOC, which became the first Indian public sector refiner from India to source US crude, has placed a cumulative order 3.9 million barrel from the US. Bharat Petroleum and Hindustan Petroleum, India's two other public sector refiners have also placed orders for about 2.95 million barrels and 1 million barrels, respectively, for their Kochi and Vishakhapatnam refineries. The total volume of the crude presently contracted by Indian public sector refineries with US is 7.85 million barrels.
Indian companies, both public and private, have made sizeable investments in US Shale assets with a total investment of approximate $ 5 billion. Indian companies have also contracted MMTPA of LNG from the US and the first shipment is expected to be delivered to India in January 2018.
"This event marks a significant milestone in the growing partnership between the US and India. The US and India are elevating our cooperation in the field of energy, including plans for cleaner fossil fuels, renewables, nuclear, and cutting edge storage and energy efficiency technologies. We look forward to working together on further sales of U.S. crude and exploring opportunities to expand the role of natural gas in India," said Mary Kay Carlson, Chargé d'Affaires at the US Embassy in New Delhi.
During their June 26 meeting in Washington, Modi and Trump committed to expanding and elevating bilateral energy cooperation through a Strategic Energy Partnership. The leaders called for a rational approach that balances environment and climate policy, global economic development, and energy security needs. Trump affirmed that the US continues to remove barriers to energy development and investment in the US and to US energy exports so that more natural gas, clean coal, and renewable resources and technologies are available to fuel India's economic growth and inclusive development, the US Embassy said.
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