“Oil & Gas sector will continue to play animportant role in meeting India’s growing energy demand, even as the countryhas charted out a roadmap towards creating clean energy generationinfrastructure. In order to meet the growing aspirations of crores of peoplewho now form the ‘middle class’, we will require unhindered oil and gassupplies,” Prime Minister Shri Narendra Modi said while inaugurating the IndiaEnergy Week (IEW) 2023 in Bengaluru last month.
Held under the patronage of the Ministry ofPetroleum and Natural Gas, India Energy Week is the pre-eminent platformconnecting India’s booming network of energy stakeholders with internationalcounterparts for collaboration and conversation for a responsible and smartenergy transition on India’s road to net-zero.
Addressing the delegates gathered at the event, Union Minister for Petroleum and Natural Gas,and Housing and Urban Affairs, Shri Hardeep Singh Puri said, “When wetalk about energy security, essentially from the perspective of countries thatare not oil producers, and are heavily dependent on imports, it meansavailability, predictability, stability, and affordability of oil and gas. In alarge democracy like ours, where 60 million people go to petrol pumps everymorning to fill up, where 05 million barrels of crude is consumed in a day,energy security is very important.”
The government has also lifted No-Gorestrictions thereby making 10 lakh square kilometre area available forExploration and Production, Puri said. “By doing so, we want internationalplayers with expertise in Exploration and Production to come to India and helpincrease in-house oil production. The government is creating new opportunitiesfor investment and collaboration in the energy sector of India,” he said.
Speaking at the event, Prashant Ruia, Director,Essar Capital, and Chairman of the Board, Essar Oil UK stated that the industryneeds fossil fuel support for clean energy transition. He was speaking at asession ‘Transitioning to a low-carbon energy mix: how are energy companiesadapting?’
Industry leaders believe that fossil fuel willplay a crucial role if India has to achieve its target to reduce emissionsintensity of its GDP by 45 per cent by 2030. Experts present at the event highlightedthe importance of fossil fuel in the clean energy roadmap.
“Building clean energy systems are somethingwhich will take a lot of time. Therefore, the smart option is to do both. Transitionof existing capacities and creation of new energy capacities must be donetogether,” Ruia added. “The idea is to use existing capacities to decarboniseand bring in future fuels to be supplied from the existing capacities. Havingsaid that, it is not an easy solution to replace. However, we must use all theexisting infrastructure to build new and clean energy systems.”
Ruia was of the opinion that the one thing whichgoes in India’s favour is the fact that technology, in this space, is evolvingpretty fast. “Improvement in technology will be fast and quick as we have seenin solar space. The challenge right now is to bring down the cost of hydrogen(production). But, I am sure that in the next few years, we would see rapidprogress in this space,” he said.
Clearly understanding the need of the day ofhaving a mix of fossil and renewable sources of energy with cutting-edgetechnologies, India has rationalised its actions to ensure minimum impact onthe environment. Highlighting the role of the Indian Oil and Gas industry,Union Minister of Petroleum and Natural Gas and Minister of Housing and UrbanAffairs, Shri Hardeep Singh Puri said, “Our Oil and Gas industry has made significantstrides in recent years. It has risen to the occasion in a commendable mannerduring these challenging times by ensuring energy supplies.”
“Our strategy of development rests on seven keytransitions to low carbon development pathways. The strategy calls for lowcarbon development for electricity systems consistent with development,development of an integrated, efficient, and inclusive transport system,promotion of faculty and material efficiency in buildings, sustainableurbanisation, economy-wide decoupling of growth from emission, and developmentof efficient innovative low emissions industrial systems,” the minister said.
“India is uniquely positioned when it comes tobuilding clean energy systems to meet its future energy demand,” said HiteshVaid, Chief financial officer, Cairn Oil and Gas (Vedanta). “While wedefinitely cannot copy what is happening in developed countries, we also needto have a plan. There has to be a lot of different plans working simultaneouslytowards a common goal.”
Fossil fuel should be seen as a part of thesolution rather than the problem, reiterated Vaid. “We need to see how weexplore it fully. How do we find out new opportunities? What incentives do wegive to renewable? How do we ensure that all the organisations are consciouslyworking on their own plans? What are the fiscal benefits?” he asked.
Speaking at the session ‘Prices and Supply volatilityaddressing global energy security need’, Secretary General, OPEC, Haitham Al Ghais said Oil exploration andproduction sector requires about 12 trillion-dollar investment by 2045. “AtOPEC, we strongly believe that this investment is required to ensure energysecurity for all. The sector has suffered chronic under-investment in the lastfew years and its production has fallen by about 6 percent, forgetting aboutgrowth to meet increasing global demand,” the OPEC Secretary General added.
He said the Organisation of the PetroleumExporting Countries is in favour of transition and cleaner energy switching butsaid the issue here is not about the source. But it is about emission. “We allneed to work together to reduce the emission so that there is energy securityfor all,” Ghais said.
All this becomes relevant considering the factthat, within Asia, India will have the highest energy demand growth in thecoming decades. The Indian energy demand is projected to increase from 18.6million barrels per day of oil in 2021 to 37.7 million barrels perday in 2045.