India-Russia Energy Cooperation

  Jun 05, 2020

India-Russia Energy Cooperation

Which areas were covered?

India and Russia during the 20th summit in Vladivostok, signed Roadmap for Cooperation in Hydrocarbons for 2019-24.

The two sides agreed to explore joint development of oil and gas fields in Russia and India including offshore ones.

As many as 15 MoUs were signed which included one between the Ministry of Energy of the Russian Federation and the Ministry of Petroleum and Natural Gas of India on the use of natural gas for transportation.

Another one signed by the two sides was for "expansion of cooperation in the oil and gas sector." 

Russian gas producer Novatek signed a pact with Petronet LNG Ltd for liquefied natural gas supply and joint development of downstream LNG business.

They will continue their work to develop the ways of delivering energy resources from Russia to India, including a long-term agreement for sourcing Russian crude oil, the possible use of the Northern Sea Route and a pipeline system.

India and Russia agreed to consider the prospects for expanding cooperation in hydro and thermal power, energy efficiency as well as for designing and constructing facilities that generate energy from non-conventional sources.

Also, the two leaders noted the immense potential of cooperation in the field of non-nuclear fuel and energy.

The two sides also agreed to cooperate in supply of coking coal from Russian Far East to India.

The two nations agreed on expanding energy partnership in hydro and thermal power.

The ongoing nuclear energy continues. For example, expansion of Koodankulam plant.

What is its significance?

India, the world's third-biggest oil consumer and importer, aims to raise the proportion of gas in its energy mix to 15% in the next few years and diversify its energy supply to hedge against geopolitical risk.

India wants to cut India's oil imports by 10 percent by 2022, is steering efforts to buy foreign energy assets, taking advantage of low global oil prices and a slowdown in China's overseas acquisitions.

Indian companies have stakes in Russian hydrocarbon assets including the Sakhalin-1, Imperial Energy, Vankor and Tass-Yuriakh fields, but it rarely imports oil from there because of logistical constraints and higher freight costs. The present deals enhance energy security with more investments.