All stakeholders – including private players and the public sector – should partner enthusiastically to make India the global hub of green hydrogen, highlighted Minister of Petroleum & Natural Gas Hardeep Singh Puri on Day 1 at the India Energy Forum organized by CERAWeek during 20 – 22 October 2021. Mr Puri asserted that the government in carrying out several reforms in mission mode to create an environment sustainable for green hydrogen. He noted that earlier during his interaction with US Envoy for Climate Change, he had mentioned that the Ministry of Petroleum & Natural Gas is essentially acting as the Ministry of Energy Transition to attain a sustainable energy future for the country.
Ministry MoPNG (center), MoS (right) and HIS Markit Vice Chairman (left) during Opening Remarks
The Minister said that for a sustainable future, there is the need to blend hydrogen with Compressed Natural Gas (CNG) for both transportation and industrial use. He stated that the emphasis on green hydrogen from the oil & gas PSUs is massive, however, the economic viability should also be looked upon too, to make hydrogen cheaper and accessible for the common mass.
“The government earlier introduced 5 per cent biofuel mix in 15 States and Union Territories. Today, 10 per cent biofuel mixing is taking place and in the near future we will achieve 20 per cent mixing with sugarcane and food grains. We are hereby also boosting the rural economy by promoting sustainable use of fuel for transport,” said Mr Puri.
Minister of Petroleum and Natural Gas addressing the gathering
On the exploration and production of oil & gas, Mr Puri said that the emphasis has now shifted from revenue gain to production enhancement. He asserted that the ministry is dedicated to do whatever it takes to support the E&P sector. “E&P activity is going on in less than 8 per cent of our total area. We need to ramp up that production. Government has notified several investor-friendly reforms to boost production and we are looking forward for partnership with international players too,” he added.
Delivering special remarks on the occasion, Minister of State for Petroleum and Natural Gas Rameshwar Teli said that energy is at the core of the emerging India’s fast-pacing economy. He said that India is well on track to become the fastest growing economy. “Although, to achieve its objective of emerging as a global economic leader, India shall seek help of domestically produced energy and require energy imports from our allies amongst global energy majors,” he said.
“India Energy Forum provides a dynamic and strategic perspective to India’s energy affairs to global industry and government. In order to ensure the distribution of energy to the vast population of India, it is key priority to make energy accessible to the needy at the grassroots level,” added Mr Teli.
MoS Petroleum and Natural Gas delivering address
He said that over the next two decades, India expects a significant growth in energy demand. Mr Teli added that it is imperative that the leading nations join hands and provide solutions to fight challenges posed by the global threat of global warming. Highlighting the initiatives taken by India to pursue clean energy, he said that we have taken several steps to facilitate the biofuels and hydrogen policy framework. The MoS noted that India has also introduced some path-breaking reforms in the areas of exploration and production, marketing and pricing of natural gas, etc.
Petroleum Secretary Tarun Kapoor, speaking on whether high prices accelerate the transition away from oil, questioned how reliable the imports of oil and natural gas are in the face of the recent price hikes. He suggested looking at long-term contracts, which can provide some level of protection from the volatility of the market. The Petroleum Secretary flagged that the rising prices are taking away reliability on these resources. Alternatively, he asked whether Indian companies could make investments in some oil fields.
“In the pandemic, the price of oil fell around 75 per cent, which is not good for the oil producing nations. However, now the prices have shot up too high. Can any consumer absorb that? It is simply impossible,” he said.
Petroleum Secretary delivering on energy transition
Responding to whether high oil prices will impact government policy on transition, Mr Kapoor said that it definitely has the potential to force change. “We had drawn up a plan to move towards biofuel and get more natural gas to shift from coal. Although we have huge reserves of coal, we are still looking to move to cleaner sources of energy. As capacity for renewable energy went up, we were planning to gradually make the transition,” said Mr Kapoor. However, he noted that the rising oil and gas prices may force the hand of the government and they may have to look for energy sources that can be produced within the country.
Mr Kapoor also pointed out that while high prices of oil may have some good fall-outs like early transition towards electric vehicles, etc, but said it is creating a very difficult situation in the short term.
Speaking during the session, Global Head of Commodities Research in Global Investment Research (GIR) at Goldman Sachs International Jeffrey R Currie said that anything happening in oil and gas is not exclusive to any geographic area or sector. “Every commodity is facing the same situation,” he said flagging that price may average around USD 90 by the end of the year. He noted that it is expected to add more volatility. Mr Currie noted that high prices alone will not be able to accelerate transition. It is essential to avail the commodities to enable the transition away from oil, he said.
Panel on ‘Will high prices accelerate the transition away from oil’
Organization of the Petroleum Exporting Countries (OPEC) Secretary General HE Mohammad Sanusi Barkindo said that there is no better time for global community to converge. Flagging the unrealistic targets of many countries, he said that oil and gas will continue to dominate the global energy basket till 2045 and well past that. Mr Barkindo said that there is a need to address the issues from the perspective of facts and data. “Climate change can only be comprehensively addressed when we look at it from the perspective of energy poverty,” he said adding that CERAWeek can help get some global consensus.