Indian EPC giant L&T will bid for hydrocarbon orders worth $20 billion in the current fiscal year and hopes to convert 15% to 20% of bids into executable orders, Subramanian Sarma, whole-time director and senior executive vice president of Energy, told Moneycontrol.
Sarma said L&T has a “strong order pipeline,” which gives the company a certain amount of stability and certainty.
“Oil prices are in the $65-$75 range. They will also remain stable in that range, which is good for both suppliers and consumers…I think the next 2-3 years will be reasonably stable. Our focus has been good execution and to make sure that customers remain satisfied, so that we can continue to gain increased market share,” Sarma said.
He added that L&t is active mainly in two markets—India and overseas.
“The overseas market includes the Middle East and Africa. In the domestic market, we have good prospects in the refinery sector,” Sarma said.
While several international oil companies have rolled back and said that they will continue to allocate capital for gas and oil, Sarma said that the Middle Eastern market still has appetite for developing conventional oil and gas projects.
Since the Middle East is seeing huge capital expenditure, several projects have been announced and L&T is “quite busy bidding” in the region.
He went on to add that the global trend of energy transition has slowed down a bit after the Russia-Ukraine conflict.
“People are realising that there is a journey we have to go through for the transition; it cannot happen rapidly. Also, the cost of energy, if not affordable, should be at least reasonable. So maybe the energy transition ambitions and aspirations were a little bit far-fetched to start with; it is getting moderated,” Sarma explained.