Lok Sabha Question No. 2824 (UNSTARRED), answered on 2024-12-12
Subject: Dependency on Crude Oil Import
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Shri Vijayakumar Alias Vijay Vasanth, Shri Manickam Tagore B

## LOK SABHA UNSTARRED QUESTION NO- 2824 TO BE ANSWERED ON 12 TH  DECEMBER 2024

## DEPENDENCY ON CRUDE OIL IMPORT

2824. SHRI VIJAYAKUMAR ALIAS VIJAY VASANTH: SHRI MANICKAM TAGORE B:

## पेůोिलयम और ÿाक ृ ितक गैस मंýी

## Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

(a) whether the Government has taken any measures to reduce the India's dependency on 85 percent import of crude oil and if so, the details thereof;

(b) the estimated impact of the 15 percent rise in oil and gas imports on India's trade deficit along with the mechanism adopted by the Government to mitigate the inflationary pressures due to rise in oil prices;

(c) the Government's strategy to diversify India's energy mix;

(d) the scheme of the Government to promote renewable energy sources;

(e) the reasons by which the domestic crude oil production declined by three percent;

(f) the steps taken/being taken by the Government to boost the domestic oil production and domestic natural gas production;

(g) whether the Government has any plan to address the decline in petroleum product exports; and

(h)  if  so,  the  details  thereof  along  with  the plan to  increase  refining  capacity  to  reduce  the dependence on imports?

## ANSWER

## पेůोिलयम और ÿाक ृ ितक गैस मंýालय म¤ राºयमंýी ( ®ी सुरेश गोपी )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI SURESH GOPI)

(a) to (d): Government has adopted a multi-pronged strategy to reduce the import dependency on  crude oil which, inter alia, include demand substitution by promoting usage of natural gas as fuel/feedstock across the country towards increasing the share of natural gas in economy and  moving  towards  gas  based  economy,  promotion  of  renewable  and  alternate  fuels  like ethanol, compressed bio gas and biodiesel, creating electric vehicle charging infrastructure, refinery  process  improvements,  promoting  energy  efficiency  and  conservation,  efforts  for increasing  production  of  oil  and  natural  gas  through  various  policies  initiatives,  etc.  For promoting the use of Compressed Bio Gas (CBG) as automotive fuel, Sustainable Alternative Towards Affordable Transportation (SATAT) initiative has also been launched.

Government  has  also  taken  several  other  steps  to  insulate  common  citizens  from  high international  prices,  which  included  diversifying  the  crude  import  basket,  invoking  the provisions  of  Universal  Service  Obligation  to  ensure  availability  of  petrol  &  diesel  in domestic market, increasing the blending of ethanol in petrol, etc.

Recently PSU OMCs have carried out intra-state freight rationalisation. This has benefitted consumers located at remote areas, far from Petroleum Oil & Lubricants (POL) Depots in form of reduced Petrol and Diesel prices in remote parts within the states. This initiative has also  reduced  the  difference  between  the  maximum  and  minimum  retail  prices  of  Petrol  or Diesel within a state.

During  the  last  ten  years,  Ethanol  Blending  Program  (EBP)  by  Public  Sector  OMCs  has resulted in approximate savings of more than Rs. 1,08,655 crore of foreign exchange as on 30.09.2024. The ethanol produced from sugar-based feedstock has helped sugar factories to reduce  its  surplus  sugar  inventory  and  generate  revenue  early  to  clear  the  dues  of  cane farmers.  During  the  last  ten  years,  EBP  has  helped  in  expeditious  payment  of  approx.  Rs. 92,409 crore to the farmers as on 30.09.2024. It is anticipated that 20% ethanol blending in petrol is likely to result in payment of more than Rs. 35,000 crore annually to the farmers.

India's  energy  sector  is  undergoing  a  significant  transformation  with  a  growing  focus  on cleaner sources of energy. Government is working towards achieving 500 GW of installed electricity capacity from non-fossil sources by 2030. Schemes such as Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM), PM Surya Ghar Muft Bijli Yojana, National  Programme  on  High  Efficiency  Solar  PV  Modules,  National  Green  Hydrogen Mission, have been launched.  Scheme for setting up of Ultra Mega Renewable Energy Parks is being implemented to facilitate the project developers for expeditious completion of such projects.  Government  has  also  approved  the  Viability  Gap  Funding  (VGF)  scheme  for offshore wind energy projects for installation and commissioning of 1 GW of offshore wind energy projects.

Further,  The  Ministry  of  New  and  Renewable Energy is implementing  the National  Green Hydrogen Mission, with an objective to make India a global hub of production, usage and export of Green Hydrogen and its derivates.

Government also notified the National Bioenergy Programme (NBP) with an aim to promote the use of bioenergy and waste-to-energy technologies to support clean energy solutions to enhance energy security and support sustainable development in India. To promote green fuel and other alternate fuels, public sector undertaking oil and marketing companies (IOCL/BPCL/HPCL)  are  required  to  install  facilities  for  marketing  at  least  one  new generation alternate fuels i.e. CNG/LNG/Electric Vehicle Charging points etc. at their retail outlets.

(e) to (f): The decline in production of crude oil in recent years has been due to natural decline and increase in water cut in wells of matured fields. However, the trend has reversed in 202324 as the government has been taking various steps to boost domestic oil and gas production which, inter-alia, include:

- i. Policy under PSC regime for early monetization of hydrocarbon discoveries, 2014.
- ii. Discovered Small Field Policy, 2015.
- iii. Hydrocarbon Exploration and Licensing Policy (HELP), 2016.
- iv. Policy for Extension of PSCs, 2016 and 2017.
- v. Setting up of National Data Repository, 2017.

vi. Appraisal of Un-appraised areas in Sedimentary Basins under National Seismic Programme, 2017.

vii.  Policy  framework  for extension  of  PSCs for  Discovered  Fields  and  Exploration  Blocks under Pre-New Exploration Licensing Policy (Pre-NELP), 2016 and 2017.

viii. Policy to Promote and Incentivize Enhanced Recovery Methods for Oil and Gas, 2018. Nomination Fields, 2018.

ix. Policy Framework for exploration and exploitation of Unconventional Hydrocarbons under Existing  Production  Sharing  Contracts  (PSCs),  Coal  Bed  Methane  (CBM)  Contracts  and x. Lower Royalty Rates, Zero Revenue Share (till Windfall Gain) and no drilling commitment in Phase-I in OALP Blocks under Category II and III basins to attract bidders. xi. Release of about 1 Million Sq. Km. (SKM) 'No-Go' area in offshore which were blocked for exploration for decades.

xii.  Government is also acquiring seismic  data  in  onland  and  offshore  areas  and  drilling  of stratigraphic  wells  to  make  quality  data  of  Indian  Sedimentary  Basins  available  to  bidders. Government has approved acquisition of additional 2D Seismic data of 20,000 LKM in onland and 30,000 LKM in offshore beyond Exclusive Economic Zone (EEZ) of India.

(g) to (h): Oil Companies after meeting the domestic demand, export surplus production of petroleum  products  through  tendering.  Export  of  petroleum  products  by  Indian  refiners depends on various factors such as local demand supply scenario, international prices, price bids received, seasonality, refinery shut down etc. Oil Refining capacity of the country has been augmented gradually from 215.07 Million Metric Ton per annum (MMTPA) to 256.8 MMTPA over last 10 years.

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