India will open 'Russian energy corridor' to reduce dependence on traditional suppliers
MOSCOW: India and Russia will reveal a comprehensive energy cooperation agreement next week when Prime Minister Narendra Modi and Russian President Vladimir Putin meet in Vladivostok which seeks to open an energy corridor in the Far East aimed at reducing India's dependence on traditional fuel suppliers.
The framework, which will be signed at the Modi-Putin summit, points to an alternative route for oil, gas and coal from the Russian Far East, an area marked by both nations for greater cooperation and investment.
A joint declaration on integral energy cooperation will be issued. A complete five-year roadmap will be signed. Several topics will be mentioned on the road map. The discussions are in a final stage. A new dimension is coking coal. He also signed at the company level, oil minister Dharmendra Pradhan told TOI.
India is preparing to begin regular imports of Russian crude and coking coal, both from the far eastern region of Russia, where Indian state-run oil companies have invested billions of dollars in oil and gas projects. In this context it is fitting that the plan be revealed at Vladivostok, a major terminal of the Trans-Siberian railway.
Modi is the main guest at this year's Eastern Economic Forum, Putin's annual presentation of world leaders and industry captains, to promote investments in the Far East region, rich in natural resources. Pradhan's visit is the third consecutive of an Indian minister, after the Minister of Commerce, Piyush Goyal, and the Minister of Foreign Affairs, S Jaishankar, with the aim of preparing the basis for the Modi-Putin summit.
Senior executives of state oil companies such as IndianOil accompanying Pradhan are discussing the terms of oil imports. Russian crude, compared to the expensive North Sea Brent, has so far found its way here only occasionally due to price problems and difficulties in shipping from the Far East.
The Russian crude supply agreement will send a strong signal to the OPEC oil export cartel and its members from West Asia, the main suppliers in India. Russia is a close partner of OPEC. It is also a large producer and exporter of oil and gas. The term contract will show that it is possible to reduce India's dependence on OPEC. Help our negotiations with OPEC, a senior executive told TOI.
Russia's agreement also balances India's growing energy ties with the United States. IndianOil earlier this year signed a term contract for US crude, the first for India, to recover lost volumes after New Delhi stopped buying Iranian oil due to US sanctions. Other refineries are also looking for term contracts for US crude. In addition, the state-owned gas services company GAIL also has long-term LNG contracts.