Oil Minister Hardeep Singh Puri on Saturday said that the ministry will set up an energy security fund, emphasising that it will help domestic oil and gas firms stay relevant in the future.
The Ministry of Oil and Natural Gas (MoPNG) held a day-long strategising session in Bangaluru on Saturday, holding deliberations with top ministry and CPSU officials on India’s energy mix for 2040.
“Started the day with an engaging discussion with top officials of oil sector PSUs & @PetroleumMin on strategizing India’s energy mix for 2040 and creating an energy security fund which are crucial for keeping our oil companies relevant in the future. These discussions will show the way forward to India’s journey towards energy sufficiency under the leadership of PM @narendramodi Ji & prepare our energy sector for the future,” Puri tweeted on X.
According to different global outlooks and PPAC’s transition scenario, India’s CAGR growth from 2022 to 2040 is estimated at 3 per cent, with the share of oil in total Primary Energy at 41 per cent in 2040. The integration of refineries and petrochemicals into an oil-to-chemical model is the way forward for the industry. This will not only enhance efficiency but also create new opportunities, he added.
The Minister did not provide any details on the fund or how it will be utilised. However, sources said that the fund could be used to acquire oil and gas assets in foreign countries.
Rare earth minerals
The CPSUs under the charge of MoPNG will now explore rare earth minerals.
The Minister emphasised that oil and gas companies have the prowess to extract and refine natural resources as demand for renewable energy and battery storage intensifies.
“We will also assess the need to acquire rare earth minerals. Discussed the sources, value chain, domestic and international reserves and the way forward for our oil companies to engage in mining of rare earth minerals in our brainstorming session today,” he added.
Gas-based economy
Puri noted that India’s natural gas consumption has risen steadily to 187 million standard cubic meters per day (MSCMD) in FY24 from 137 MSCMD in FY15.
“Under the visionary leadership of PM @narendramodi Ji, we are exploring new pathways and initiatives to move towards a cleaner, greener, more affordable fuel, natural gas. In our brainstorming session, we discussed key drivers of global LNG demand, forecasts of LNG shipping, LNG terminals demand assessment and key policy drivers necessary to push the transition,” he added.
Many states such as Assam, Andhra Pradesh, Maharashtra and others have taken the progressive and visionary step to reduce VAT on natural gas, the minister said, adding that he hopes that more states will reduce VAT on natural gas as it will help in movement towards a gas-based economy.