Lots of news this week on energy companies from one particular spot on Earth.
In Lebanon — where reports suggest Indian state oil firm ONGC will bid for offshore blocks. In Canada — where Indian officials are said to be negotiating coking coal supplies. And even in Venezuela, where the cash-strapped government is seeking to sell ONGC a 9 percent stake in the key San Cristobal oil field.
And a new study released this week suggests it’s not coincidence we’re hearing so much about Indian companies on the energy stage.
In fact, India has quietly become one of the world’s biggest energy investors.
That revelation came from the International Energy Agency (IEA) — which released a report yesterday on energy investment trends for 2016. Showing that India’s investment in energy projects surged during the past year.
All told, India’s spending on electricity, oil and gas, coal and renewables jumped by 7 percent in 2016, as compared to the previous year. Reaching nearly $100 billion.
As the chart below shows, that rise was enough to vault India into third place globally for energy investment. Edging out oil giant Russia. India moved into third place globally for energy spending in 2016.
(Click to enlarge)
Of course, India’s energy spending is still a long way off second-place U.S. and top investor China. But the rapid rise of energy investment here shows this is an up-and-coming spot for project funding in oil and gas, and beyond.
IEA attributed India’s ascent to new government policies helping to modernize and expand the economy. Further evidence the country is “getting its act together” in becoming a true natural resource superpower.
That’s an important point of note for project developers globally. Especially given Indian firms seem to have appetite for places further out on the risk spectrum — evidenced by this week’s action in places like Lebanon and Venezuela.
As a final point of interest, the IEA study also showed that — for the first time ever — electricity passed oil and gas as the top energy sector for investment in 2016. Coming as capital spending in the global petroleum space plunged 38 percent between 2014 and 2016.
The group says however, that petro-spending should jump in 2017. Watch for Indian companies to be a big part of those deals and new projects.