Digging Out The Truth

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[<p><p align="justify"><span class='dropthecap'>A</span> lot is being bandied about the production of oil by Cairn India from the Mangala fields of Rajasthan, and how in the next two years it would become 20 per cent of local production. But that is like comparing apples with oranges. India largely imports its oil requirements, and so the Cairn production figures need to be compared with the country's consumption rather than local production. </p><p align="justify">India imports 2.4 million barrels of oil per day, while it produces only 680,000 barrels of oil per day. By 2011, when Cairn India will produce 175,000 bpd (on peak production), it will fulfil 6 per cent of India's oil requirements.</p><p align="justify">For an economy like India with high oil dependency, it needs a Cairn every year. "India has been incrementally consuming 160,000 bpd every year and that is equivalent to Cairn's peak production," says Ballabh Modani, an oil analyst with Enam Securities. India needs a lot more oil than just Cairn's.<br /><br />----------------------------------------------------------------------------------------<br /><br /><strong>STRICTLY BUSINESS</strong></p><p align="justify">PetroChina, Asia's largest oil company, will pick up a 60 per cent stake in two five-billion barrel Canadian oil sands projects — MacKay River and Dover fields — for $1.7 billion from Athabasca Oil Sands. Canada's oil sands are estimated to hold 173 billion barrels of oil. Oil sands projects are more complex and costlier than conventional oil projects.<br /><br /><a href="http://www.businessworld.in/bw/image/Finance/Banking/fdi_graphic_300x381.gif" target="_blank" title="A Problem Worth Nothing">Click here to view &#39;A Problem Worth Nothing&#39;</a></p> <script type="text/javascript"> var intro = jQuery.trim(jQuery('#commenth4').text()) var page = jQuery.trim(jQuery('#storyPage').text()) if (page.indexOf(intro) < 0) { jQuery('#commenth4').attr('style', 'display:block;') } </script> (This story was published in Businessworld Issue Dated 14-09-2009)