Oil India To Invest Rs 25,000 Crore In Clean Energy Projects, To Become Net Zero By 2040

Oil India's net-zero plan includes reducing gas flaring, commercialising stranded gas, establishing renewable electricity generation capacity, and constructing green hydrogen facilities

OIL is joining other state-owned oil and gas firms by investing to help India reach its net-zero emissions target by 2070.

Source : Oil India Ltd

State-owned Oil India Ltd (OIL) is planning to invest Rs 25,000 crore in clean energy projects as part of its strategy to reach a net-zero carbon emissions target by 2040, according to the company chairman Ranjit Rath, reported PTI. The company's plan includes reducing gas flaring, commercialising stranded gas, establishing renewable electricity generation capacity, constructing green hydrogen facilities, and developing biogas and ethanol plants, he said.

"Our Rs 25,000 crore commitment is for for array of activities including green hydrogen, compressed biogas plants, renewable portfolio. geothermal energy, zero flaring initiative, CCUS projects, and 2G ethanol plants," OIL Charman Ranjit Rath said in a press conference on Thursday, reported PTI. 

He said that OIL intends to allocate around Rs 9,000 crore for the development of 1,800 megawatts of solar and onshore wind energy projects. Additionally, Rs 3,000 crore will be invested in a green hydrogen project, and Rs 1,000 crore will be dedicated to carbon capture, utilisation, and storage (CCUS) initiatives. The company has already finalised plans for 640 MW of solar projects in Assam and an additional 150 MW in Himachal Pradesh, Chairman Ranjit Rath informed. 

He also said that the firm plans to lay an 80-kilometer pipeline to bring natural gas from fields in Arunachal Pradesh to Assam to help replace polluting liquid fuels in transport as well as industries. The company is also looking to convert some of the pipelines originally built to transport crude oil, to help flow gas

"We are looking at ways to advance the net zero target to 2038," Rath said.

According to the report, OIL is joining other state-owned oil and gas firms by investing to help India reach its net-zero emissions target by 2070. Indian Oil Corporation (IOC), the country's largest oil company, aims for net-zero emissions by 2046. Meanwhile, ONGC, a major oil and gas producer, has committed to investing Rs 2 lakh crore to achieve this goal by 2038. Bharat Petroleum Corporation Ltd (BPCL) and GAIL (India) Ltd, a gas utility company, are also working toward achieving net-zero carbon emissions from their operations by 2040. Hindustan Petroleum Corporation Ltd (HPCL) is aiming for the same target by 2046.

OIL is working on a 4+ mission of raising crude oil production to over 4 million tonnes and gas output to 5 billion cubic metres, Rath said. 

"We produced 3.2 million tonnes of crude in 2022-23 (April 2022 to March 2023). This year we have an aspiration target of reaching 3.8 million tonnes and by 2024-25 we plan to achieve the 4+ mission," he said.

To accomplish these ambitious goals, a dual approach is being adopted. This involves ramping up exploration efforts to access untapped reservoirs and harnessing advanced technology to enhance production from existing fields.

In the current fiscal year (April 2023 to March 2024), OIL has allocated a capital expenditure of Rs 7,500 crore, an increase from the previous fiscal year's Rs 5,500 crore, as stated by the company chairman. Additionally, the company is exploring opportunities to establish green hydrogen and compressed biogas facilities in collaboration with its subsidiary, Numaligarh Refinery Ltd.

"OIL has set for itself an ambitious target of transforming itself to a 'net-zero' emission company by 2040 through a range of initiatives, including adopting cleaner energy sources, investing in renewable energy projects and implementing advanced technologies to minimise greenhouse gas emissions, for which about Rs 25,000 crore is envisaged to be invested by 2040," Ranjit Rath said.