India and China agree to cooperate on energy security

Apr 11, 2005 02:00 AM

India and China agreed to cooperate in their quest for energy security for their booming economies, a joint statement issued during Chinese Premier Wen Jiabao's visit to India said.
The energy-hungry Asian giants, whose thirst for energy has stretched global supplies and contributed to the record rise in oil prices, are aggressively competing for stakes in foreign oil and gas projects to secure energy supplies.

Indian Foreign Secretary Shyam Saran said the two countries needed to cooperate in their race for foreign petroleum assets.
"Obviously if both India and China are looking for oil and gas resources, if both get into a bidding war with each other it doesn't help either India or China," Saran told. "So there is a certain sense in the two countries consulting more closely with each other; in some ways coordinating with each other and in some areas, like for example in Central Asia, even working together," he said.

India's oil minister, Mani Shankar Aiyar, said India and China had made a "good beginning" in energy cooperation, which he hopes to strengthen when he visits Beijing later this year.
The joint statement said India and China would encourage "relevant departments and units of the two countries to engage in the survey and exploration of petroleum and natural gas resources in third countries".

Asian oil firms already have spent billions of dollars on projects around the world, including in countries such as Sudan that are off-limits to oil majors, and picked up scraps hived off by cost-cutting Western oil companies.
Chinese state oil giants, China National Petroleum Corp. (CNPC), PetroChina, Sinopec Group and CNOOC Ltd., have been scouring the globe for energy assets in the last five years, spending over $ 5 bn in oil and gas fields from Australia to Indonesia and Sudan to Saudi Arabia.

China imports more than 40 % of its record 6.4 mm-bpd oil demand and aims to boost overseas output, which accounts for less than 10 % of consumption. Similarly, India, which imports70 % of its crude oil requirement, has stakes in projects in several countries including Myanmar, Sudan, Russia, Libya and Australia.
India's hunt for foreign oil projects is led by state-run exploration firm Oil and Natural Gas Corp., but the country's largest refiner, Indian Oil Corp. has also joined the race and recently won an exploration block in Libya.

Source: Business News
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