An expert panel has begun work on drafting blueprint for raising India's oil refining capacity by 2040 with a view not just meeting demands of the fast expanding economy but also to capture export market.
An expert panel has begun work on drafting blueprint for raising India’s oil refining capacity by 2040 with a view not just meeting demands of the fast expanding economy but also to capture export market.
The 12-member Working Group for preparing Approach Paper for enhancing refining capacity by 2040 held it first meeting on June 27, officials said.
The panel began work by asking public and private sector refiners to present their plans for capacity expansion and asked for domestic demand assessments to be made.
The panel headed by Additional Secretary in the Oil Ministry and include directors of refineries at Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL).
It would also comprise of representatives of private sector Reliance Industries and Essar Oil besides managing directors of Numaligarh Refineries Ltd, Mangalore Refineries Ltd and Chennai Petroleum Corp Ltd (CPCL), officials said.
India has a refining capacity of 232.066 million tons, which exceeded the demand of 183.5 MT in the 2015-16 fiscal. According to International Energy Agency (EA), this demand is forecast to reach 458 MT by 2040.
Considering a modest fuel demand growth of 4 per cent, the present capacity will be insufficient in next few years.
“India is one of the fastest developing countries in the world and simultaneously, the world energy demand is expected to double in the next 30 years with energy portfolio undergoing a transition to one that includes a wide range of sources,” said an oil ministry order constituting the Group.
Officials said expansions underway will raise the refining capacity to about 260 MT by 2018.
The rise in projected demand, the order said, paves the way for gradual shift towards renewable and cleaner fuels richer in hydrogen or to neat hydrogen.
“It has been envisioned that the energy mix in 2040 could be entirely different from what it is today. Also, new capacities in petroleum refining will depend upon aggregation of demand from different petroleum derived products, which itself depends upon substitution by other forms of energy and government policies,” it said.
It was felt that an approach paper for refinery capacity expansion of PSU refineries by the year 2040 needs to be prepared for meeting the growing demand of petroleum products in the country, the order said.
Officials said the Working Group in three months would assess primary energy requirement for 2040 as also likely technological developments in different energy fields.
It would then develop primary energy mix with breakup in terms of gas, oil, coal, nuclear, solar, hydro and biofuel.
India has leapfrogged from a modest 62 million tons per annum refining capacity in 1998 to 232 MT at the end of March 31, 2016.