ASEAN OIL AND GAS

MARKET OVERVIEW
@ OSEA - 2010
29 November 2010

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ASEAN/South Asia Oil and Gas Team
Team Leader - MALAYSIA INDIA
Paul Martins Jinendra Khara
E: Paul.Martins@austrade.gov.au E:jinendra.khara@austrade.gov.au

BRUNEI INDONESIA
Josie Abdullah Irfan-Zuhdi
E: Josie.Abdullah@austrade.gov.au E: Irfan.Zuhdi@austrade.gov.au

PHILIPPINES THAILAND
Tata Corpuz Pannalak Lieokomol
E: Tata.Corpuz@austrade.gov.au E: Pannalak@austrade.gov.au
SINGAPORE SINGAPORE
Irene Tay Janice Aw
E: Irene.Tay@austrade.gov.au E: Janice.Aw@austrade.gov.au

VIETNAM VIETNAM
Hoa Nguyen Shannon Leahy
E:Hoa.Nguyen@austrade.gov.au E:Shannon.Leahy@austrade.gov.au
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ASEAN Overview

• The IEA World Energy Outlook forecasts that the Association of South
East Asian Nations (ASEAN) will become a key global energy market
and future growth driver.
• The report indicates that energy consumption and demand in this region
is equal to that of the Middle East and is expected to grow at a rapid
pace during the next couple of years.
 Growth will be spurred by increasing population, infrastructural and
industrial development, and economic growth.
• Although the per-capita energy consumption of the region is
considerably lower than that of others, the Primary Energy Demand
(PED) is expected to increase by 76% during 2007-30, which is an
annual increase of 2.5% until 2030.

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ASEAN Energy Resources
Source: Pipop Pruecksamars, Executive Director, Petroleum Institute of Thailand

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ASEAN Energy Resources
Source: Energy Information Administration – US Government

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ASEAN Overview

• Challenges haven’t changed much over the years:

• High cost
• Over dependence on legacy assets
• Decreasing field size in maturing play
• Emerging countries competing for E & P investment (against
Europe, Africa and Asia)
• Opportunities
• Enhanced recovery
• Technologies/innovations/systems that reduce operational
costs/risks
• Subsea processing
• Maintenance initiatives
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Austrade ASEAN Assistance – the other AAA

• The Austrade Oil and Gas Team can assist you in many
ways:
• Market briefings
• Awareness raising/brand building
• Market opportunities
• Partner/Customer searches
• Business introductions, business matching and visit
programs, and much more
• Oil and Gas is one of many sectors we cover, so it is
best for you to get our dedicated time through tailored
service proposals and retainer agreements.
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OPPORTUNITIES IN
THE OIL & GAS
INDUSTRY
29 November 2010

MALAYSIA

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MALAYSIA OIL AND GAS INDUSTRY

• Malaysia‘s oil and gas production have fallen for two straight years,
declining to the equivalent of 1.63 million barrels of oil in the year to
March 31 from 1.66 million a year earlier
• The country has tapped deep-water fields to increase reserves as
energy demand rises.

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ACCESSING MALAYSIA’S OIL AND GAS INDUSTRY

• Petronas dominates upstream and downstream activities and holds

exclusive ownership rights to all exploration and production
- All foreign companies must operate through production sharing contracts (PSCs)
- ExxonMobil is the largest foreign oil company by production volume, although
numerous others operate under PSCs, including Chevron, Shell, Conoco Philips,
BP, and BHPB
- is currently the largest owner and operator of LNG tankers in the world (29 LNG
ships)
• Malaysia was the 3rd largest LNG exporter in the world after Qatar
and Indonesia. Petronas bought a A$2b stake in the Santos coal-
seam gas LNG project in Gladstone/Qld. They now have an office in
Brisbane.
• Petronas spent RM26b/AUD$10b in capital expenditure for the
domestic market for the year ending March 31, 2010

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MALAYSIA OIL AND GAS INDUSTRY

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MALAYSIA’S OIL AND GAS INDUSTRY - PETRONAS

PETRONAS works to certain procurement principles to encourage local

participation and the transfer of technology. To operate in the upstream
industry, companies need a PETRONAS license, which is only granted to
companies with 51% Malay ownership.

There are two options for a foreign company to be licensed with

PETRONAS:

1. Either: By appointment of a local company to be the exclusive

agent
2. Or: By incorporating a local joint-venture (JV) company with a
local partner to perform business operations in Malaysia

In both situations, the agent or JV company must submit the application

for license to PETRONAS.
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ACCESSING MALAYSIA’S OIL AND GAS INDUSTRY

Opportunities
• The development of oil, gas and energy has been identified as one
of the 12 National Key Economic Areas in the country.
• There are many international contractors with a presence in
Malaysia. These include: Foster Wheeler, Aker Solutions, Ranhill
Worley Engineering, Sime Engineering, Technip, MMC Oil & Gas
Engineering, Toyo Engineering & Construction, JGC, Chiyoda, JP
Kenny, Bechtel and many others.
• Upstream opportunities include deep-water and marginal field
development (advanced drilling technology, reservoir engineering,
subsea engineering and a range of design and maintenance
services, in addition to equipment supply) as well as asset
rejuvenation

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OPPORTUNITIES IN
THE OIL & GAS
INDUSTRY
29 November 2010

Brunei

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Brunei Oil & Gas Industry

Market Overview
• Brunei Shell Petroleum Company Sdn Bhd‘s primary
activity is the exploration and production of crude oil and
natural gas from onshore and offshore fields.
• It also owns the Brunei Refinery.
• The Government of Brunei Darussalam and The Asiatic
Petroleum Company Limited are equal shareholders.

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Brunei Oil and Gas Industry

OPPORTUNITIES

Highly specialised business in the following categories:

>Drilling and Related Specialist Services

>Wellhead Supply and Installation Services

>Wireline services

>Instrumentation, Analysers & Electrical

>Engineering maintenance

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OPPORTUNITIES IN
THE OIL & GAS
INDUSTRY
29 November 2010

PHILIPPINES

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Philippine Oil and Gas Industry

• DOE long term natl • Capacity additions to

plan: 60% energy 555.12 MW from
self sufficiency target hydropower; 18 MW
from biomass; 623
• Renewable Act 2008: MW wind
develop cleaner
sources of energy. • Geothermal
resources with
• RE Law had 87 RE Chevron under the
Service and Financial and
Operating Contracts Technical Assistance
in the first ten Agreement
months

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PHILIPPINE OIL AND GAS INDUSTRY

• Energy self-sufficiency
level grew to 58% in
2009.

• Geothermal contributes
23.2% in the supply mix;
biomass 13.8%; natural
gas 8%.

• The transport sector

remains to be the
biggest consumer of oil.

• Luzon grid mostly coal-

fired power plants 27%;
oil 21%; natural gas 18% ASEAN NOW

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PHILIPPINE OIL AND GAS INDUSTRY

• The transmission lines

traversing the entire country
has a total length of 20,129
circuit kilometres;

• Total sub-station capacity is at

24,732 MVA

• Luzon and Visayas grid share

power via submarine cable
interconnections, while
Mindanao remains a separate
grid.

• National Grid Corp Philippines.

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PHILIPPINE OIL AND GAS INDUSTRY

• Malampaya Oil Field is owned

by PNOC-EC 10%; SPEX BV
and Chevron LLC 45% each

• Galoc Oil Field owned by Nido

Petroleum 22.88%; The Galoc
Prodn Co thru European Trade
Vito group 68.6% and Otto
Energy 31.4%

• Drilling of Southern Sulu Sea by

Exxon Mobil owning 50%; Mitra
Energy Phils Ltdf and BHP
Billiton own the remaining 50%

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 PHILIPPINE OIL AND GAS INDUSTRY

Opportunities

• PNOC-EC will require supply and delivery of one lot

conveyor belt

• One unit 200 KVA Transformer

• Two units of centrifugal pumps

• Shell and Chevron requires thermal spray aluminum

• Asian Development Bank Technical Assistance and

Investment Projects for 2010-2011

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OPPORTUNITIES IN THE OIL & GAS
INDUSTRY
29 November 2010

SINGAPORE

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 Singapore Oil & Gas Industry

Singapore
T is the world’s …

 Largest rigs fabricator and supplier

 Third largest refining Centre

Source: SEDB

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 Singapore Oil & Gas Industry

Two major companies - Offshore Oil Rigs

KeppelFELS Total value of contracts:S$4.7b
Delivery: until 2013
KeppelFELS “B” Class –Seadrill - 33

Sembcorp Total value of contracts: S$5.0b

Delivery: until 2013

Opportunities – Offshore Oil Rigs

 NEW
 REPLACEMENTS
2010 -About 75 per cent of the rigs in operation worldwide
were more than 25 years old. Replacements needed
to be built. Sembcorp PPL’s B M Pacific Class 375 -13/14
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 Singapore Oil & Gas Industry

SUCCES
SES
Abrasives HVAC Systems
Cables Insulation -thermal
Cabins (pressurised) Lightning Protection
Chemical Scrubber Motors & Pumps
Coatings (Pipeline) NDT Testing
Cranes Pipes, hoses & fittings
Compressors Pipe Supports
Design -Engineering Rig Inspection

KeppelFELS Semi submersible Expansion joints Safety Products

Engineering services Seals
Electrical Enclosures Switchgear
Electrical products Torque Tools
Fire Protection Tow lines & Moorings Sembcorp rig
Flooring – safety Training - Technical
Goggles & eye wash Weather Forecasting
Hazardous equipment Winches …..
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Singapore Oil & Gas Industry
JURONG ISLAND Chevron Philip

ExxonMobil

Shell

Mitsui Chemicals

Sumitomo

Chemicals

BASF

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Singapore Oil & Gas Industry

Refineries in Singapore

Shell 460,000 b/d

ExxonMobil 610,000 b/d
SRC 300,000b/d

TOTAL CAPACITY : 1.370m b/d

Source: BMI

* b/d = barrels per day

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Singapore Oil & Gas Industry
Petrochemical Complexes
IN OPERATION
Petrochemical Corporation of Singapore
- PC1 and PC2
ExxonMobil
CONSTRUCTION
ExxonMobil

SHELL
PLANNING STAGE
 Jurong Aromatic ASEAN NOW

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 Singapore Oil & Gas Industry
OPPORTUNITIES
 Synthetic Rubber Plant
• Lanxess (Germany)
• Euro$400m Foster Wheeler - EPCM
• Expected completion: 2013

 Third LNG tank to be built at LNG Terminal

Source: Singapore Energy
on Jurong Island Market Authority

• EPC – Samsung and Foster Wheeler

 Oil Storage - Very large floating structures

• Process of tender bid for Consultant (FEED)

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Singapore Oil & Gas Industry
OPPORTUNITIES

Some of the major EPC companies include:

• Foster Wheeler
• Halliburton
• Jacobs Engineering

Australian companies in the market:

• Worley Parsons
• Downer EDI

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OPPORTUNITIES IN
THE OIL & GAS
INDUSTRY
29 November 2010

THAILAND

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THAILAND OIL AND GAS INDUSTRY

Market Overview
• Mineral, Fuels and Petrochemical contribute 10% of total export
• Consumer market with 80% of crude oil was from imports ;
20% is natural gas import
• Largely privatised oil and gas sector
• Dominated by PTT
• Had recently resolved environmental issues.
Court lift suspension order of 76 projects.

Upstream business
• Active IOCs –Chevron, Hess, Mitsui, BG, Pan Orient Energy, etc.
• Major oil& gas refineries ExxonMobil, Chevron and PTT with total capacity of
1.2m barrel/day

DownStream business
• One of the World‘s largest Petrochemical Complex. Now in the third phase
• PTT and SCG group dominate petrochemicals industry
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THAILAND OIL AND GAS INDUSTRY
UPSTREAM DOWNSTREAM

PTT groups
• PTT chemical
• PTT Aromatics and Refining
• Bangchak Petroleum
• Thai Oil
• IRPC
• PTTEP
Until 1Q 2010, total 84 E&P blocks (44 onshore & 40 offshore) • PTT
• Pailin, Arthi, Bongkot, Erawan, Yadana, MTJDA
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 THAILAND OIL AND GAS INDUSTRY

Opportunities
• Installation of Chevron‘s Thb2.73 Billion underwater cable - 2012
• PTT/EGCO/ EGAT ‗s $930m (5mt) LNG project –Q4, 2011
• The first LNG imports from Quarta– Q4, 2010
• Refineries upgrade to comply with Euro IV standard – 2012
• Sriracha (Esso) to install new processing plant
constructed by Foster Wheeler
• PTTAR‘s $220 million upgrading project
• PTT‘s 6th GSP – Q4-2010
• Thai Caprolactam plant expansion – early 2012
• Ube Nylon – Q4, 2010
• SCG-Dow Group and Solyvay Peroxythai for hydrogen peroxide to propylene oxide (HPPO) –
Q1,2011
• Management of existing and aging offshore platform
• FPSO – Future trend
• Extension of fuel pipeline to N , N/E – long term
• PTTEP‘s procurement visit OSEA
• Siam Gas interest in LPG Expected quantity 1MT

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OPPORTUNITIES IN THE OIL
& GAS INDUSTRY
29 November 2010

VIETNAM

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Vietnam Oil & Gas Industry

Market Overview – Why Vietnam?

• An emerging and important regional producer of oil and
natural gas in South East Asia
• Crude Oil is the country‘s biggest foreign currency earner
• Ranked 3rd in the S.E.A. and 36th for oil – ranked 45th for gas
in the world
- Proven oil reserves: 4.7 bil barrels (‗09) – 26th in the world
- Proven gas reserves: 610 bil cubic metres (‗09) – 31st in the world
• Over 50 foreign oil & gas companies with exploration
contracts
• Registered investment capital of more than US$7 billion
• Rapid growth means Vietnam is facing an energy deficit
• Crude export will be declined to feed refineries
• PetroVietnam Group is dominating the industry

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Vietnam Oil & Gas Industry

Vietnam Oil Exploration Vietnam’s main oil fields;

• Bach Ho (White Tiger),
• Rong (Dragon),
• Rang Dong (Aurona),
• Hong Ngoc (Ruby),
• Dai Hung (Big Bear),
• Bunga Kekwa – Cai Nuoc
• Most oil exploration and
production activities occur
offshore in the Cuu Long and
Nam Con Son Basin.
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Vietnam Oil & Gas Industry

Vietnam’s Gas Industry

• Proven gas reserves of 610 bcm(2009).
• Gas production capacity - 21 million cubic metres per day (2009).
• Associated and natural gas is produced entirely for domestic consumption.
• The Cuu-Long basin is a source of associated gas from oil production and
Nam-Con-Son basin is a source of natural gas.
• Gas from Nam-Con-Son basin is piped to an onshore treatment plant, then it
is used for generating power in Phu-My Power Complex in Baria-Vungtau
province.
• Two more large scale gas pipeline projects underway including Nam Con
Son 2 and Omon-Can Tho pipeline

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Vietnam Oil & Gas Industry

Vietnam’s Gas Market Overview

• In 2010 the region will consume an estimated 496 bil cubic metres (bcm)

• Demand of 625bcm is targeted for 2014.

• Production of a forecast 415bcm in 2010 should reach 522bcm in 2014,

which implies net imports rising from around 81bcm to 104bcm.

• A forecast deficit in gas supplies due to rapid growth will lead to the
increased import of LPG sources and LNG in the future.

• PV Gas a company under PVN is looking at importing LNG to meet local

demand from around 2012-2013

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Vietnam Oil & Gas Industry

Vietnam’s oil refineries

• Vietnam wants to reduce country‘s reliance on imported refined products.
• In 2005 started construction of first oil refinery at final cost of U$3.05bil
• Located in Dung Quat, Quang Ngai province, refinery will have capacity of
6.5 millions tons per year.
• Commissioned May 2010.
• Second refinery will be set up in Nghi-Son, Thanh-Hoa province, at est. cost
of US$6.2 billion with a capacity of 10 million tons per year.
• The Nghi-Son Refinery & Petrochemical Complex will open in 2013.
• The third refinery will be in Long-Son (Baria-Vungtau province) at a cost of
about US$6 billion with a capacity of 10 millions tons per year.

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 Vietnam Oil & Gas Industry
Dung Quat Oil Refinery – Vietnam first refinery
• Calculated up to 9-2010, Dung Quat imported 5.72 million tonnes of crude oil
and provided an output:
- 4.63 million tonnes of crude oil
- 4.98 million tonnes of qualified products.
- 4.500 million tonnes of fuel for JetA1 – sold to BP Singapore Pte. Ltd
• In the near future, Dung Quat Oil Refinery will be upgraded with a new capacity
of 10 million tonnes crude oil as approved by the government.

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Vietnam Oil & Gas Industry

Regulatory Environment
• PetroVietnam, the national oil & gas company is the key player
• It is empowered to make decisions on strategies and policies for industry.
• Signs petroleum contracts, implements, monitors, inspects and supervises all
petroleum activities.
• PetroVietnam supplies up to 70% of services for the domestic oil and gas
sector.
• All oil and gas exploration and production activities in Vietnam are subject to
cooperation with PetroVietnam.
• To date, exploration rights for only 25-30% of the country‘s continental shelf
with hydrocarbon potential have been awarded.
• The remaining offshore areas, generally with water depths of 200 meters or
more, are unexplored and open for new bidding.
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Vietnam Oil & Gas Industry

Major Oil and Gas Companies in Vietnam

PetroVietnam
BP
ConocoPhilips
Petronas
Mitsubishi
KNOC
Chevron
Exxon Mobil
Zarubezhneft
Talisman Energy
Origin Energy
Santos
Premier Oil
Japan Vietnam Petroleum

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Vietnam Oil & Gas Industry

Oil & Gas

Opportunities & Challenges
Opportunities:
- Vietnam growing energy demand will ensure increased
exploration offshore and opportunities for trade and
investment
- New oil wells & expansion of existing wells
- New infrastructure projects (Refineries, power plants,
petro-chemicals, pipelines)

Major offshore projects:

- Bien Dong Project
- Chevron Gas Project

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Vietnam Oil & Gas Industry

Oil & Gas

Opportunities & Challenges
Challenges:
- Strong competition of suppliers from USA, EU, Japan.
- Customers do not want to change suppliers if there is no
problem with existing supply sources.

Australian companies already in market: Origin Energy,

Santos, WorleyParsons, Arrow Energy, Peak Well Services,
Australian Fluid Handling, JP Kenny, Elliott, Binder Group,
Xtreme Machining

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Oil & Gas Presentation
India

Business Development Manager

Jinendra Khara
 Market Overview

• Petroleum products and natural gas together contributed 2.36 per cent,
or US$ 21.25 billion, to the country‘s total GDP (US$ 900.19 billion) in
2007–08.

Key segments —upstream and downstream

• The upstream segment comprises exploration and production (E&P)
activities.

• The downstream segment comprises the refining and production of

petroleum products, processing, storage, marketing and the
transportation of commodities such as crude oil and natural gas.

Source: ―Basic statistics on Indian petroleum & natural gas 2008–09,‖ Ministry of Petroleum & Natural Gas.
 Upstream segment (exploratory and development drilling)
• The total number and metreage of
exploratory and development wells drilled in
onshore and offshore areas in 2008–09 was
381 and 888,000 metres, respectively.

• In 2008–09, the maximum number of wells

(onshore) have been drilled in Gujarat
state(167).
Source: ―Basic statistics on Indian petroleum & natural gas 2008–09,‖ Ministry of Petroleum & Natural Gas.
 Downstream segment (refining)
• India has 20 refineries —17 in the public sector and three in the private
sector.

• The country‘s refining capacity increased to 177.97 million tonnes per

annum (MTPA) in April 2009 from 148.96 MTPA in the previous year.

• Total refinery crude throughput in 2008–09 was 160.77 MMT,

increasing by 2.99 per cent over the volume in 2007–08 (156.10 MMT).

• The Government of India (GoI) has opened the refining industry to

private sector investment to achieve faster growth.

• Reliance Industries Limited (RIL) is the largest player in the private

sector.
Source: ―Basic statistics on Indian petroleum & natural gas 2008–09,‖ Ministry of Petroleum & Natural Gas‖
 Refineries in India

Source: mapsofindia.com
Opportunities :
• Cranes, Hoists, and Winches
• Deep-Sea Drilling Services
• Marine Equipment and Services
• Offshore Engineering & Design Services
• Offshore Platforms (Fixed and Floating)
• Pollution, Oil Spill Control, and Environmental Technologies
• Power Supply, Engines, and Turbines
• Process Equipment
• Production Equipment and Services
• Project management services
• Pumps and Compressors
• Software Engineering Services & Equipment
• Wellhead Assemblies
• Well-Completion Equipment & Services
Major players in India
• Indian Oil Corporation (IOC)
• Oil and Natural Gas Corporation
Ltd (ONGC)
• Hindustan Petroleum Corporation
Limited (HPCL)
• Bharat Petroleum Corporation
Limited (BPCL)
• Oil India Limited
• GAIL (India) Limited
• Reliance Industries Limited (RIL)
• Essar Oil Limited
• Adani Gas
• Petronet LNG
• Cairn Energy India Pty Ltd
• Shell
• BP
• BG Group
•
Getting Business in India

• Most of the deals with oil & gas companies in India (esp.
with Public Ltd companies) are based on tender.

• Key point is having the name in the vendor list, then the
supplier will be invited to participate in the tender.

• Suppliers will have to directly approach the buyers in

advance or appoint local agents for keeping close
contact with buyers and promoting their products/
services in Indian market.
Disclaimer
This presentation contains information and advice of
a general nature only and before relying or acting
on it you should obtain the advice of your financial
and other advisers in the light of your own
particular circumstances.

While the information and advice contained in this

presentation is believed to be accurate at the time
it was prepared, AUSTRADE disclaims all liability
to any person who relies on the information and
advice for any inaccuracies or omissions.

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OSEA2010

THANK YOU FOR YOUR ATTENTION

WISH YOU A FRUITFUL WEEK @ OSEA2010!

AUSTRADE TEAM

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