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Shri Mani Shankar Aiyar Minister of Petroleum & Natural Gas of India and Mr. Shoichi Nakagawa, the Minister for Economy, Trade and Industry of Japan, held a meeting in Tokyo, today with a view to accelerating, deepening and widening cooperation between India and Japan in the hydrocarbons sector.
The two Ministers recalled their very fruitful initial meeting in New Delhi in January this year. They also noted that the visit to India by the Prime Minister Mr. Junichiro Koizumi in April 2005 had placed the Indo-Japanese energy dialogue in the larger context of the evolving Japan-India Global Partnership which aims at “promoting the vision of an Asian Economic Community as an Arc of Advantage and Prosperity”. They noted that in pursuit of the Eight-fold Initiative launched by the Prime Ministers of the two countries, in particular paragraph 18 thereof relating to the hydrocarbons and energy sector, the inaugural meeting of the Working Group on cooperation in oil and gas had laid sound foundations for further practical work on the ground. The two Ministers stressed the need for expeditious implementation of the recommendations of the Working Group. The two Ministers were of the view that the Working Group meet at least twice during 2006 to give further impetus to the process of cooperation and the Ministers meet at least once next year to keep the proceedings of the Working Group under Ministerial review.
Shri Aiyar conveyed the importance attached by India to expanding its knowledge-base in geology and geophysics and in the area of exploration and production in the country, and sought Japanese cooperation in promoting these capabilities in India. The two Ministers said that in addition to scientific and technological cooperation in oil and gas, mutual R&D cooperation would extend to related areas of energy such as coal bed methane, underground coal gasification and other unconventional fuels such as hydrogen, bio-fuels and gas hydrates and shared the view that relevant research and academic institutions in both countries should be encouraged and facilitated to network with each other to promote greater mutual understanding of the global political economy in the hydrocarbons sector.
The two Ministers expressed their determination to pursue the following Plan of Action:
(i) Encouraging Japanese companies with such assistance as possible from the Japan Oil Gas and Metals National Corporation (JOGMEC) to develop Exploration and Production (E&P) opportunities in India, including, but not limited to, services and technology areas;
(ii) Exchange of information and experience on commercial and strategic stockpiling of crude oil;
(iii) promoting Indo-Japanese ventures in the E&P sector in third countries: explore the prospects of such cooperation in Canada, Australia, West Asia (Middle East), West and Central Africa, Russia (including Sakhalin) and Central and South East Asia, taking into account the increasing tendency by the oil and gas producing countries to pursue broader economic ties with investing countries. Bearing these possibilities in mind, they welcomed the pursuit of a possible Memorandum of Understanding between ONGC Videsh Limited and JOGMEC;
(iv) examining the possibility of “swap” arrangements based on the convenience of geographical proximity;
(v) promoting cooperation in heavy oils amongst the entities concerned of both countries;
(vi) coordinating and mutually reinforcing R & D in gas hydrates through encouraging cooperation between the Indian Directorate General of Hydrocarbons and their Japanese counterpart, as well as commercial understanding between GAIL India and counterpart Japanese industries for the transportation of gas as synthetic hydrates, including examining the feasibility of transportation from isolated marginal fields;
(vii) undertaking joint research and study between a Japanese organisation and counterpart Indian organizations such as the Petroleum Planning and Analysis Cell (PPAC), The Energy and Research Institute, New Delhi (TERI) and the University of Petroleum and Energy Studies, Dehra Dun, on developing an Asian crude oil and petroleum products market and measures to stabilize the Asian oil market.
The two Ministers noted the importance of investment in each other’s countries in the hydrocarbons and related sectors. In this context, noting the significant advances made by India in the export of petroleum products, Shri Aiyar invited Mr. Shoichi Nakagawa to consider investment in India in export- oriented refineries in India as well as in such projects as the development of a petrochemicals hub at Haldia.
Since energy conservation and energy efficiency are important elements in the promotion of the energy interests of the two countries, the two Ministers shared the view that cooperation and networking was essential between the relevant institutions of the two countries, in the public, quasi-public and private sectors. They expressed their intention to work together to promote integrated energy conservation and energy efficiencies in India through the ESCO (Energy Service Companies) model. The Petroleum Conservation and Research Association (PCRA) of India has been nominated by Shri Mani Shankar Aiyar as the nodal agency to work with Japanese institutions.
The two Ministers stressed the importance of energy security as a crucial component of international peace and security. While underlining the need for exchange of information and coordination of positions in all international for a dealing with energy related issues including energy security, the two Ministers stressed the importance of the International Energy Forum(IEF) as a platform to promote global cooperation and dialogue, and directed their delegations to coordinate closely with each other to pursue the interests of both countries through the preparation of joint studies and to work together for the success of the IEF Ministerial Conference in Doha in April 2006.
Highlighting the key importance of the paradigm shift in global oil trade which has seen Asia emerging as both the principal source of hydrocarbons and the fastest growing region in demand for crude oil and gas, the two Ministers shared the view that the outcome of the study would be a valuable asset to be shared with IEF member countries.
The two Ministers also noted the importance of exchange of information between the two countries in regard to LNG imports, particularly with respect to the need for flexibility in contractual obligations pertaining to quantity and price.
Shri Aiyar reiterated his invitation to the Japanese Minister to visit India to attend the Round Table of North and Central Asian oil-producing countries with the Ministers of major Asian oil-consuming countries, including Japan. This Round Table is scheduled to be held in New Delhi on 25 November, 2005. The Japanese Minister confirmed Japanese participation at the forthcoming conference and said that he would positively examine the possibility of making it at the ministerial level.
The Japanese Minister invited Shri Aiyar to make a longer visit to Japan after the November Round Table in New Delhi so that various aspects of bilateral cooperation in the hydrocarbons and related sectors could be examined in greater detail. Shri Aiyar accepted this invitation. It was noted that the dates of the visit would be finalized through diplomatic channels.
Ministry of Petroleum & Natural Gas
New Delhi : Asvina 07, 1927/ September 29, 2005
SB/NSK/GS/MK
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