BP expects up to a tenth of its total earnings to come from India over the next ten years, but not from oil: the company will focus on natural gas, marketing, and renewable energy in one of the world's top fossil fuel consumers.
Reuters quoted BP's regional president in India, Sashi Mukundan, as saying "My aspiration is that since we (India) are material for BP, that might see 5-10 percent of BP's earnings coming from India."
Currently, the bulk of BP India's earnings comes from a US$3-billion lubricants subsidiary, Castrol India Ltd., but this is set to change as the UK-based supermajor expands its natural gas operations on the subcontinent through its joint venture with local industrial heavyweight Reliance Industries.
Back in 2011, Reuters recalls, BP bought a 30-percent stake in Reliance's exploration and production operations, and by 2022 the two partners will have three producing deepwater natural gas projects, yielding some 35 million cubic meters daily at peak production.
LNG is also a topic of interest for BP as India seeks to boost its LNG import capacity more than three times to 70 million tons annually. The government plans to build 11 new LNG import terminals over the next seven years-and more afterwards.
BP's investments in India so far total US$8 billion, the regional company president said, and it plans to invest another US$5 billion in its joint business with Reliance.
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Renewable energy investments are also on BP's agenda. India has plans to build 175 GW of renewable energy generation capacity by 2022 and, even more ambitiously, eyes getting 50 percent of its electricity from renewable source by 2030.
BP plans to spend US$500 million on renewable energy projects this year, as part of US$15-16-billion capex program for the year. The Indian renewables market is a lucrative opportunity for a company eagerly looking for ways to diversify into solar, wind, and other renewable sources of energy.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More