"It gives me great pleasure to inaugurate the 6th Petrotech Conference. The first Petrotech Conference was organised in 1995 at a time when the Indian economy was undergoing a major transformation. Since then, successive Petrotech Conferences have covered many themes. Through successive Conferences, however, one unifying theme has been the role of technology in the modern hydrocarbon sector and therefore it is most appropriate that this year's Conference has specifically picked "Value from Hydrocarbons: Advances in Science and Technology" as its theme.

Hydrocarbons continue to remain the most important source of energy, even though science has enabled power sources to be tapped. While we must continue to invest in the exploration and harnessing of power sources of energy, we must recognize the fact that we will remain greatly dependent on hydrocarbons in the foreseeable future. Hence, investing in more efficient and equitable utilisation of hydrocarbons and developing new technologies in this field ought to be important objectives of our policy.

There are two simultaneous transitions underway in our country. One is the evolution of users from traditional, non-market forms of energy to commercial forms of energy. The other is the transition from low energy consumption to high energy consumption in the processes of diversification of our economy in particular rapid industrialisation of our economy. The challenge for policymakers in our country is to be able to deal with these twin transitions.

While conventional, renewable energy sources like fuel-wood, dung cake, agricultural waste and even non-conventional sources like wind and solar energy will have enormous value for millions of users, the demand for commercial sources of energy is bound to increase. If we have to improve the quality of life for the underprivileged, it would, among other things, entail an increase in the per-capita consumption of commercial energy. And as incomes increase and urbanisation spreads there will be a further increase in per capita energy consumption. The challenge for policy makers is to provide for this increase in demand while at the same time ensuring that it is economically and ecologically sustainable.

India is believed to be not blessed with the luxury of abundant fossil fuel resources. I hope this presumption is proved wrong through advances in science and technology. Hence to make our growth model more sustainable we must step up the efficiency of energy consumption so that we can moderate the impact of growth on the demand for energy. Clearly, the challenge before us as a nation is to meet the energy needs of all segments of our population in an efficient and affordable manner ensuring long-term sustainability and environmental protection. I am told that with better energy conversion and more efficient use, we could save upto 10 million tons of oil per year which is significant. Energy efficiency and conservation should, hence, be integral to any energy strategy. This requires much greater investment in innovation and the more efficient use of energy. This is precisely the focus of your conference this year.

While addressing the requirements of energy policy today, two key issues need to be kept in mind: first, we need an accurate demand projection of what our energy mix will look like in the years to come; second, we need a relevant energy pricing mechanism. The introduction of pricing in the demand model is important as it is the critical factor that would help us not only in ascertaining the correct pattern of energy mix but also enable a better demand forecast for energy type. This would set the direction for long term investment decisions in each of these sectors. That is why I have repeatedly said that rational pricing of energy is a critical aspect of energy policy and a vital element of energy security for us.

A rational approach to energy pricing is integral to any strategy aimed at improving the efficiency of energy use and reducing the adverse environmental impact of excessive energy consumption. Recent initiatives in promoting competition in various energy sub sectors, the introduction of market-determined pricing and encouraging fuel-efficient innovations in the automobile sector are a few steps in this direction. According to some studies, the cost of environmental damage, when assessed in terms of loss in potential GDP, comes to about 10% of GDP. This is alarming and needs concerted efforts by the science and technology community for controlling it.

Our government is keen on achieving energy security through intensification of domestic exploration efforts while simultaneously accessing overseas opportunities. The government has completely opened the Exploration & Production Sector for Private participation. Through the New Exploration Licensing Policy, vast un-explored areas have been brought under active exploration. The 5th round of bidding has now been launched on 4th January, 2005, offering 20 blocks for exploration of oil and natural gas. I am sure that these rounds will contribute in a major way towards a comprehensive exploration of the Indian Sedimentary Basin and also catalyse private Investments in the Exploration and Production Sector.

There is today a national consensus on our policy with respect to the strengthening of our oil and gas companies and enabling them to emerge as global firms. Our Government will help in the growth of a strong and vibrant public sector which can compete on an equal footing with the private sector on the same terms and conditions. While the efforts of ONGC-Videsh and Indian Oil Corporation are laudable, there is still some distance our firms have to travel to catch up with global competition. I urge our oil and gas PSUs to think big, think creatively and think boldly in this context I endorse every thing that the Honourable Minister said just a few minutes ago. They have to be more fleet-footed in making use of global opportunities, both on the supply and demand side, I find China ahead of us in planning for the future in the field of energy security. We can no longer be complacent and must learn to think strategically, to think ahead and to act swiftly and decisively. This requires a greater degree of professionalism in the management of our oil and gas PSUs and in the formulation of our energy security strategy. We are exploring the possibilities of restructuring our oil PSUs to make them truly globally competitive.

Apart from pricing and sourcing, technology is another area that requires special attention. Technology today is driving business in the hydrocarbon sector and has transformed the oil industry from a commodity business that it once was, to a high-tech industry. Oil majors no longer dominate simply on the basis of their extensive reserves, refineries, and distribution networks. The new winners are firms with a grip on emerging new technologies. They have become as integral to the oil business as Intel and Microsoft are to the computer industry. Greater access to that technology has the potential today to change the playing field for both large and small firms. Here is an opportunity for Indian firms to jump start and leap frog competition through a command over new and latest technologies

At this juncture, the contribution and relevance of continuous academic and R&D support should not be lost sight of. Many Industry solutions are being provided by jointly funded research in Universities. We need to encourage these activities in our country by using our advantage in the information technology sector. Our universities and institutes constitute the backbone for the knowledge hungry hydrocarbon sector in the country. Today we are a force to reckon with in information technology. We look forward to the day when the process of collaboration and knowledge exchange initiated here spreads like wildfire to our research institutes and universities and we become a major force in hydrocarbon technology as well. That is aspiration and that should be our national ambition. For, after all, energy is as vital a sector as Information technology.

While this conference is focusing on the hydrocarbon sector, I would like to stress the importance of using science and technology to expand the frontiers of energy science, to generate new options for sourcing energy, to reduce dependence on hydrocarbons. In this context, the role of prices is crucial in sending the signals which can enable the selection of more sustainable energy forms. At the same time, we must recognize the externalities generated by excessive consumption of hydrocarbons, and the role of international cooperation in managing these externalities. We need to work actively in promoting international cooperation in mitigating these negative externalities. Further, as a country with tremendous S&T and R&D capability, we can and must play a leading role in shaping the future course of energy science, including the development of alternative sources of energy.

Conferences like yours enable our professionals, both managers and technologists, to keep abreast of the latest developments at the global level. I hope that the deliberations of your conference contribute to a vibrant energy sector in India, which can be the bedrock of growth and prosperity. I wish the conference all success."