Canada is once again emerging as a key strategic focus for Indian Oil Corporation Limited (IOCL), with plans to significantly increase its investments in Canadian energy assets. This renewed interest follows a period of strained relations between the two countries, now giving way to a strengthened bilateral energy dialogue and a pursuit of reciprocal investments.
IOCL, a major player in India's energy sector, possesses substantial financial capacity for international upstream investments, boasting a market capitalization of approximately INR 1.45-1.65 trillion and a refining capacity of 12 million barrels per day across six refineries. The company's existing international portfolio includes upstream equity stakes in Vietnam and partnerships in Australia. IOCL's approach to engagement involves high-level meetings and direct investment commitments, indicating that it views Canadian energy assets as strategic portfolio additions rather than simple supply contracts.
The renewed energy dialogue between India and Canada highlights a focus on diversifying supply chains for critical minerals, mitigating risks associated with concentrated global supplies. This includes cooperation in areas like Green Hydrogen, biofuels, and carbon capture technologies. India has pointed out a US$ 500 billion opportunity across its energy value chain, while Canada has noted $116 billion in energy projects currently under development. Future senior-level engagements are expected during a Canadian trade mission to New Delhi in March 2026.
Oil India Ltd (OIL), the country's second-largest state-owned explorer, will spearhead a consortium to secure and explore critical mineral assets in Canada. This move is driven by India's need for raw materials like lithium, cobalt, and nickel, which are essential for manufacturing electric vehicles and supporting its broader energy transition. These minerals are classified as critical and are essential for high-capacity batteries used in EVs and renewable energy storage systems.
IOCL's investment strategy in Canada will likely consider return-on-investment thresholds, political and regulatory risks, technical complexity, and long-term supply security benefits. India operates five operational LNG regasification terminals with a combined capacity of 36-38 mtpa, providing infrastructure for projected import growth.
While Canada has been a supplier of conventional fuels, the focus is shifting towards future-facing resources. Minister of Petroleum and Natural Gas Hardeep Singh Puri has stated that the “cooperation potentiality is immense,” as Indian state-backed energy firms are looking to diversify beyond oil and gas.
IOCL already has a participating interest in Canada via Pacific NorthWest LNG. Overall, IndianOil has a sizeable portfolio of oil & gas assets, with participating interest in 20 E&P blocks (9 domestic and 11 overseas) with participating interest (PI) ranging from 3% to 100%. The overseas assets are spread over many countries, including UAE, Russia, Oman, Canada, USA, Venezuela, Nigeria, Gabon, Israel and UAE.
