India’s Massive Andaman Oil Discovery: A Step Toward Replicating Guyana’s Success and Achieving a USD 20 Trillion Economy

Introduction:

In terms of crude oil and other renewable resources, India is highly dependent on other countries. The data indicates that more than 85% of India's crude oil is imported from other countries. Notably, India is the world's third-largest importer of crude oil, behind China and the United States. Indian oil demand is expected to increase by more than 1 mb/d between 2022 and 2028, driven in part by movements like urbanization, industrialization, and the rise of affluent middle-class consumers eager for travel and travel. The primary fuel, gasoline, will increase from 32% to 35% of the product mix during the projected period. If India finds oil deposits in the Andaman Sea that are equal to those in Guyana, it would be a significant breakthrough. In addition, India, being able to supply the oil domestically, would become less dependent on other countries.

 

Market Statistics:

 

• According to data on crude oil imports, India brought in 232.5 million metric tons (MMT) of crude oil for the fiscal year 2023–2024 (April 2023–March 2024).

 

• According to India's crude oil import statistics, the country imported 24204 MT in August 2024, or 19910 '000 MT.

 

• Iraq, Saudi Arabia, Russia, and the United Arab Emirates are India's main import sources for crude oil.

 

• Reliance Industries (RIL), Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL), and Rosneft-backed Nayara Energy are India's major importers of crude oil.

 

• In May, India imported a record 23.32 million metric tons of crude oil, up 9.8% month over month, according to government figures released on Monday.

 

Treasure: India's Dimension goes wide in Renewable Exploration

India is growing with astonishing development in each and every industry, with substantial investment and immense potential for making it worthy. These kinds of efforts contribute to the Indian economy by being relevant in the Asia Pacific region and put forward at worldwide dynamics trends as well. Recently, exploration in the Andaman Sea implies an oil deposit similar to Guyana's enormous discovery, which might be a game-changer for India's energy sector. Besides, deep-water drilling developments, policy changes, and heightened private sector involvement are merging to release formerly unreachable reserves. This might have propelled economic growth and considerably lessened India's dependency on oil imports. Moreover, this oil source came during an intense period, especially during the Iran-Israel conflict. Further, the adverse impact of a conflict situation in the Middle East makes a sudden and deep change in the crude oil price tag, and with such a golden opportunity for India to make a prominent position in the oil and energy industry on the global stage. 

 

India is about to find wealth and a huge oil resource near the Andaman Islands.

India is quite close to identifying an oil field in the Andaman Sea on the size of Guyana, which might contain up to 184,440 crore liters of crude oil, as stated by Union Minister for Petroleum and Natural Gas Hardeep Singh Puri. He also claims that, if the present estimates are reliable, India could hold 11.6 billion barrels of crude oil, which would be enough to cover all of its energy requirements at home and possibly start shipping fuel. Most importantly, India could surpass the neighbouring countries with a solid economic base in the Asia Pacific region. He also added that, "This discovery reflects the capability to turn around the Indian economy from a USD 3.7 trillion to a USD 20 trillion economy."  Which seems like India is ready to live the dream.

 

Key Strategy, Insights, and Extension Planning

The Indian government has allowed exploration and production (EandP) across more than 1 million square kilometres of sedimentary basins that were previously closed, particularly offshore regions like the Andaman Sea. Less than 8% of the 3.5 million square kilometres sedimentary basin in India had been explored till recently. Further, India intends to create its first Strategic Petroleum Reserve (SPR) under private management by the fiscal year 2029–2030. With the chosen private operator being given complete trading rights over all stored crude oil—a model modelled after South Korea and Japan—this represents a dramatic change in its energy security approach. This new strategy will permit full commercial use of the three SPRs that are currently only partially commercialized in India. A 29.3-million-barrel reserve in Odisha and an 18.3-million-barrel facility in Padur, Karnataka, are the two new SPRs now under construction. In an emergency, the government will still have the first claim to the oil. Moreover, to uplift such industry development, the Indian government earmarked Rs 55.97 billion (about USD 647 million) in its 2025–26 budget to purchase crude oil for its Strategic Petroleum Reserves (SPRs). This move is part of a broader push to bolster the country’s energy security amid global supply uncertainties. The Indian Strategic Petroleum Reserve Ltd (ISPRL), which manages the SPRs, currently operates three facilities in southern India with a combined capacity of around 5 million tons. The budget also includes allocations for operation and maintenance (Rs 1.8 billion) and land acquisition and construction of new caverns (Rs 3.35 billion).

 

Industry players' Collaboration and Working Setup

Key Industry Player:

• Indian Oil Corporation Ltd. (IOC)
• Bharat Petroleum Corporation Ltd. (BPCL)
• Hindustan Petroleum Corporation Ltd. (HPCL)
• Oil & Natural Gas Corporation Ltd. (ONGC)
• Oil India Limited (OIL)
• Rosneft-backed Nayara Energy

 

Why Andaman Offshore, and what are the reasons behind holding more focus?

 

• Multibillion barrels of hydrocarbon reserves, particularly oil and gas trapped in intricate deepwater structures, may be found in the Andaman deepwater region, as per geological research.

 

• Further, the technical difficulties, legal restrictions, and geopolitical sensitivities, the area have not received enough attention.

 

• Pinpoint geographical presence due to its proximity to important shipping lanes in Southeast Asia and the Bay of Bengal, and it has more logistical and financial relevance as well.

 

• Andaman provides India with the opportunity to achieve energy independence in a stable offshore location, as opposed to the unstable supply lines in West Asia.

 

Recent Infrastructure:

Oil India Limited (OIL) announced a significant investment of Rs 2,500 crore for the first phase of exploratory drilling in the Andaman basin, marking a major step in its offshore exploration strategy.

 

• Total Capex: Rs 2,500 crore for Phase 1.
• Number of Wells: 4 offshore exploratory wells.
• First Well: Already drilled to a depth of 3,800 meters.
• Next Three Wells: Planned depth of up to 4,000 meters each

 

Oil and Natural Gas Corporation (ONGC) is now starting drilling operations in the region, while state-run oil company Oil India Limited (OIL) finished drilling its first well in the Andaman Sea, according to officials. This is a big step from such big domestic industry players, which contribute to the Indian economy and industry growth. In addition to drilling its first well (Vijaya Puram 1), Oil India Ltd. (OIL) has started drilling in two shallow-water blocks (AN OSHP 2018/1 and 2) and expects to drill three more with a Rs 2,500 crore investment. "ONGC has targeted an ultra-deepwater well in the largely unexplored basin, and OIL plans to drill two more wells after its first-ever well," they continued.  OIL started seismic surveys in the Andaman offshore blocks in October 2020, following an almost three-decade break.  The two hindrances in the shallow waters, AN-OSHP-2018/1 and AN-OSHP-2018/2, span 9,616.7 square kilometers. Besides, Oil India Limited (OIL) is constantly seeking partnerships with international oil corporations (IOCs) for deep and ultra-deepwater exploration as the Indian government steps up its efforts to draw in foreign capital for its energy industry. Additionally, the Oilfields (Regulation and Development) Amendment Bill, 2024, which is intended to encourage investments in India's oil and gas exploration projects, will be a significant incentive for IOCs to consider India as an alluring exploration destination, underlined by Chairman and Managing Director Ranjit Rath. 

 

What Next?

The Andaman Basin is emerging as a high-potential frontier area for oil and gas exploration in India, particularly offshore in the Bay of Bengal. In short, India could take the ride of independence in the energy and oil industry, which could give the Indian economy a rigid baseline, and it could enter the ranks of the largest and sufficient economy on a global scale. Concurrently, the Indian government also mentions some pinpoint locations for such crude oil reserves.

 

Current location:

• Assam
• Gujarat
• Rajasthan
• Mumbai High (offshore)
• Krishna–Godavari (KG) Basin (offshore)

 

Strategic Petroleum Reserves (SPRs)

• Visakhapatnam
• Mangalore
• Padur (Karnataka)

 

Final Sum-up

The expansion of the middle class and favorable demographics will support growth. If the Andaman Basin has the potential to be India's following significant discovery, on par with Guyana's deepwater wealth treasure. India's energy trajectory might be significantly altered by its development, which would also lower imports and strengthen the argument for larger strategic reserves abroad. The market for crude oil in India is expected to increase further due to rising demand, careful supply-side diversification, and large expenditures in refining infrastructure. These milestones highlight India's efforts to improve energy security and economic resilience, as well as its crucial role in the global energy environment.

 

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