| United Front: Prime Minister Atal Bihari Vajpayee with petroleum minister Ram Naik in New Delhi on Friday. (PTI)
New Delhi, Jan. 10: Prime Minister Atal Bihari Vajpayee said today that the government is examining the feasibility of establishing strategic storage facilities for crude oil and petroleum products.
In his keynote address at the Petrotech-2003 he said that this would create a buffer for meeting unforeseen disturbances in the supply chain and strengthen India’s oil security.
Referring to recent developments in the world oil market which have caused oil prices to soar, he said that oil security has come to occupy a key position in the “present policy matrix of the government.”
The Prime Minister said that crude oil prices may shoot up if tensions rise in West Asia, leading to prolonged shortage of supplies in the world oil market. This may adversely affect our national economy, he added.
He emphasised the need to bridge the gap between the developing and developed countries for creating an equitable global environment.
He further stated that a transparent and independent regulatory system would be put in place in order to ensure a healthy and sustained development of the hydrocarbon sector in the country.
“The Petroleum Regulatory Bill is before Parliament and we will strive to ensure its early passage,” he said.
“We have also embarked upon a detailed study to identify ways to minimise supply risk from external sources,” he said emphasising that security of supplies had become one of the most important challenges, particularly for nations that are increasingly dependent on oil imports for their sustained economic growth.
Cautioning that without substantial domestic production, the nation would be subject to the volatility in crude oil supplies and prices and ‘oil security’ would be difficult to achieve, Vajpayee said “We are aware of the need to find viable strategies to explore, produce and refine more from our own hydrocarbon resources.”
It is for achieving this objective India had opened up the petroleum sector, where PSUs had been pre-dominant in the last four decades, for private and foreign investment, he said.
Not only the government had encouraged both domestic and international enterprises to supplement the efforts of PSUs, the petroleum companies were also looking at new areas within the country and outside to match the rapidly growing demand for petroleum products.
“In the petroleum industry, globalisation has provided an opportunity for India to be a significant centre for equipment and services both in upstream and downstream sectors,” he said.