India an ideal investment

June 12, 2003
Though exploration and production are now dominated by India's ONGC, there is significant private-sector interest in the country's upcoming New Exploration Licensing Policy (NELP) IV.

Though exploration and production are now dominated by India's ONGC, there is significant private-sector interest in the country's upcoming New Exploration Licensing Policy (NELP) IV.

Evidence of foreign interest was responsible for the apparent optimism of attendees at the Houston road show promoting NELP IV, which saw record attendance.

Recent deepwater discoveries have raised the profile of India's offshore, making investment opportunities considerably more attractive.

"India offers a very significant opportunity," according to Vean Gregg, vice president of the natural resources group at JP Morgan.

"India will become a very attractive area for foreign direct investment," he said, pointing out that India is one of the fastest growing oil markets in the world.

Gregg predicted the region will undergo dramatic development in the petroleum sector, noting, "By 2010, India is expected to be the fourth largest petroleum market in the world."

Private sector participation has increased in the recent past, Gregg said. And there is "significant running room" for new participants in a region he characterized as "underexplored and underdeveloped."

The favorable demand/supply dynamic, large unexplored hydrocarbon potential, significant recent commercial discoveries, sector deregulation, and attractive terms and conditions of NELP IV combine to make India a good place to invest, Gregg said. A testimony to the country's stability is the fact that JP Morgan is increasing investment in India. "Expect India to be among leaders of countries worldwide for petroleum growth," Gregg said.

06/12/03