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India’s oil demand to reach 500 million tonnes per year by 2040

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Indias oil demand to reach 500 million tonnes per year by 2040

India’s crude oil demand to increase to 500 million tonnes per year by 2040, however, the continuous increases in oil prices may limit the rate of growth, Partha Ghosh, an executive director of Indian Oil Corp said on Tuesday.

From this, the demand will increase to 10 million barrels per day from around 4.7 million barrels per day in 2017.

Worldwide oil demand will rise by 15.8 million bpd from now till we reach 2040, Ghosh mentioned in the Asia Pacific Petroleum Conference (APPEC) in Singapore. India’s growth of 5.9 million bpd will make up about 24% of the overall gain, he stated.

As new and existing refineries continue developing their own infrastructure, the country’s refining capacity will become 439 million tonnes per year as of the financial year 2030. Moreover, domestic demand of the forecast to rise to 356 million tonnes per year until 2030.

If India is able to produce high refining capacity oil, then it will be able to export oil products to various other countries available in the same region.

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Partha Ghosh, the executive director for optimization at Indian Oil Corp stated that “In the future, say about five to seven years down the line, when more refineries with bigger capacities come up, better (export) infrastructure will come along with that.”

He further added, “Then, it’ll be possible, even if the domestic demand does not grow because of high prices, refineries will be competitive enough to actually supply products to the entire region, be it East Africa or Asia.”

India’s fast economic growth and amazing benefit of having a population of youngsters will be the main factors to increase energy demand growth. But, the rate of oil demand growth will decrease in 2024.

Ghosh stated, “While alternatives and energy efficiency is expected to reduce oil demand, the biggest dampening factor will come from a sustained increase in oil prices. India’s economy is very sensitive to oil prices. It’s said that a $10 per barrel increase reduces India’s GDP by 0.2 to 0.3 percent.”

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India is the leading buyer of Iranian oil and it is wanting a waiver on the sanctions the United States is placed to impose on the country in November. But, Indian oil will be able to handle despite not getting the exception.

Lastly, he stated, “We’ll have to increase buying from other resources. Indian refineries are quite versatile. They’re not dependent on any particular type of crude. So, it’s possible to manage with alternative sources”

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Petroleum Industry

No relief from higher fuel prices despite rate cut

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No relief from higher fuel prices despite rate cut

Despite the centre declaring Rs 2.50 per litre decrease in the prices of fuel, the common man is unable to experience any relief, because of ever-increasing prices of petrol and diesel.

Fuel Prices continued to increase on Tuesday, with petrol being sold at 23 paise more at Rs 82.26 per litre and diesel at Rs 74.11 per litre after the price hike in New Delhi.

While in Mumbai, petrol prices have reached Rs 87.73 per litre and diesel at Rs 77.68 per litre after a hike of 23 paise and 31 paise respectively.

By considering the scenario of ever-increasing fuel prices, Finance Minister Arun Jaitley, in the beginning of the month had declared a cut of Rs 2.50 per litre on both petrol and diesel prices and commanded the state governments to implement the same.

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After this announcement, modification of petrol prices is being implemented in states such as Assam, Bihar, Chhattisgarh, Goa, Gujarat, Jharkhand, Jammu Kashmir, Himachal Pradesh, and Uttar Pradesh. The revision is yet to be implemented in rest all the states across the country.

Prices of Petrol and Diesel are continuously increasing since the last 3 years. There has been a decrease in the prices of fuel only 1-2 times since then. Prices of fuels are burning holes in the pockets of the citizens.

Before a month, petrol prices have reached an all-time high in September. On September 10, 2018, petrol costs Rs 88.12 per litre in Mumbai, which is all time high as compared to petrol prices on September 14, 2018.

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Petroleum Industry

Govt plans to mix Methanol with LPG to cut subsidy bill by 30%

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Govt plans to mix Methanol with LPG to cut subsidy bill by 30%

The government is thinking of a plan to sell LPG mixed with methanol, which may help to reduce its cooking gas subsidy by about one-third as compared to the existing prices.

As per the details of some countries, mixing 20% of methanol with LPG can help to bring the cost of cooking gas for household consumption by Rs 100 a cylinder.

The portion of methanol in the mix can be increased as India improves production of methane from coal. Moreover, there will also be financial benefits, looking over the country’s LPG subsidy bill which is estimated to be more than Rs 20,000 crore in the fiscal 2019 budget.

The government has distributed suitable coal mines for the production of methane – methanol in its liquid form. This step was taken just after NITI Aayog arranged roadmap for a methanol economy for the country. This will reduce fuel import bill in both automotive and household sectors.

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The whole project may be handled by the NITI Aayog. The outlines of the project are talked between the members of think tank and union minister Nitin Gadkari, who has been given the task to promote alternative fuels in the country.

Presently, the LPG consumers have to buy the fuel at the market price. The government provides subsidy on 12 cylinders of 14.2-kg per each household a year, transferring the subsidy amount instantly into the bank account of the user.

The subsidy amount differs every month based on the charges in average international benchmark LPG rate and foreign exchange rate. When international rates are high, the government provides more subsidy. The subsidy per cylinder in August was Rs 291.48 per cylinder and it was
Rs 257.74 in July.

India’s LPG consumption reaches to 2 mt a month, increasing constantly in the last 2 years due to the government’s push towards increasing access of LPG under Pradhan Mantri Ujjwala Yojana (PMUY). More than half the country’s demand is met with imports.

Also Read: Haryana government signs deal with Indian Oil Corporation to set up bio-CNG plants

According to the NITI Aayog’s ‘methanol economy’ roadmap, there can be an annual decrease of $100 billion in crude imports by 2030, if the country moves to 15% mixed fuel, both for transportation as well as cooking. The goal is to produce methanol from highly available low-quality coal and different bio resources and also manufacture it artificially.

From this, it is expected that the increasing demand of methanol can be met locally.

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Petroleum Industry

Haryana government signs deal with Indian Oil Corporation to set up bio-CNG plants

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Haryana government signs deal with Indian Oil Corporation to set up bio-CNG plants

Haryana Government on Thursday signed a memorandum of understanding (MoU) with Indian Oil Corporation (IOCL) for establishing new bio-CNG plants depending on the paddy straw and various other agri-waste in the state. The first compressed biogas plant (CBP) is most probably going to be built in Kurukshetra.

The contract was being signed on behalf of Chief Minister Manohar Lal Khattar is going to open opportunities for developing about 200 CBPs in the state until 2023, with an overall capacity of 1,000 tonnes per day of compressed biogas, one of the official statement said.

By opening new plants, there will be an annual production of around 4 lakh tonnes of compressed biogas per annum, it said.

Shailendra Shukla who is the Chairman of Haryana Renewable Energy Development Agency (HAREDA) signed the MoU in presence of state government, however, Executive Director Subodh Kumar signed in presence of IOCL.

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Subodh Kumar also demanded the chief minister to put foundation stone on the first compressed biogas plant in Kurukshetra in November 2018. He also mentioned that by signing the contract, the IOCL would start work on the setting up of this plant.

The main purpose of government is to promote agriculture waste which depends on biomass or waste to compressed biogas or Bio CNG plants in order to solve the issue of crop residue burning and scientific disposal of agriculture waste. This will help to increase farmers’ income by sale of crop residue and also help to generate new rural employment opportunities.

P K Mahapatra, who is the Additional Chief Secretary, New and Renewable Energy stated, the generation of compressed biogas on a commercial scale will have some amazing pros, such as reducing pollution due to crop burning and offering an economic option to the crop residue, providing more sources of revenue to farmers, rural employment and value creation in the rural economy.

He further stated that the compressed biogas is almost identical to the currently available CNG in its composition and energy potential. This means it can be used as a green automotive fuel.

Kumar mentioned that around 100 tonnes per day of argo residue when feed into the biogas plant can produce around 10 TPD compressed biogas and 30 TPD dry manure. The cost to set up this kind of plant is around Rs 35 crore and it needs 6-10 acres of land.

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Their main purpose is to promote compressed biogas with around 96% methane content which is absolutely better than CNG (around 86% methane) and would have better combustion qualities.

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