Welcome Hydrocarbon Initiative in Iran
It is wholly welcome that India has offered to invest up to $20 billion in new petrochemicals complexes, fertiliser plants and liquefied natural gas (LNG) facilities in hydrocarbons-rich Iran. It would enable us to source much-needed fuel and feedstock supplies at fine rates, while Iran would be able to leverage its gas assets to shore up value addition in petrochemicals, apart from monetising its hydrocarbon reserves. Oil minister Dharmendra Pradhan has reportedly sought adequate land in the Chabahar Special Economic Zone, and is also seeking long-term natural gas supplies on mutually attractive terms. It makes perfect sense for Indian companies to join hands with Iranian joint venture partners to explore and produce oil and gas, build petrochemical plants, and also invest in gas-processing facilities and port infrastructure, especially in the new industrial hub of Chabahar. Natural gas is the cleanest fossil fuel by far and Iran, which has the world’s second-largest gas reserves, is geographically close to western Indian ports. It is also a fact that natural gas accounts for a lowly share — barely 9% — in our commercial energy mix. It needs to rise significantly. The way ahead is to shore up both LNG supplies and possibly piped gas from the Persian Gulf. In parallel, there’s the pressing need to firm up joint-venture fertiliser plants in Iran using cheap feedstock. It would meet our domestic deficit for nitrogenous fertiliser and also provide for exports. It is also welcome that New Delhi and Tehran have reportedly decided to finalise by October how best to develop the Farzad-B gasfield in Iran, which was discovered by ONGC Videsh (OVL), the overseas arm of state-owned oil producer ONGC. It may even make sense to unlock shareholder value with an IPO and list OVL.