OMCs, pol­i­cy­mak­ers bet on hy­dro­car­bon de­mand

Business Standard - - ECONOMY & PUBLIC AFFAIRS - AMRITHA PIL­LAY

Even as growth in the re­new­ables and elec­tric ve­hi­cles (EVs) seg­ment threat­ens the con­ven­tional en­ergy land­scape, oil mar­ket­ing com­pa­nies (OMCs), oil and gas pro­duc­ers, and pol­i­cy­mak­ers re­main con­fi­dent that de­mand for hy­dro­car­bons is here to stay.

The in­dus­try ex­perts voiced their opin­ions at the chief ex­ec­u­tive of­fi­cer (CEO) con­clave on Sun­day.

MM Kutty, sec­re­tary for petroleum & nat­u­ral gas, ex­pects hy­dro­car­bon, mo­tor spirit and gas will play an im­por­tant role, even with the growth of the EV mar­ket.

Rep­re­sen­ta­tives from the oil pro­duc­ers’ com­mu­nity voiced sim­i­lar views. “In per­cent­age terms, the num­bers look high, but ab­so­lute num­bers would show a dif­fer­ent pic­ture. We should not be con­cerned about it. How­ever, we do re­alise the sit­u­a­tion is chal­leng­ing,” said Shashi Shanker, chair­man and man­ag­ing di­rec­tor (CMD), Oil and Nat­u­ral Gas Corporation (ONGC), with re­spect to the dou­ble-digit growth in the re­new­able en­ergy space.

The in­dus­try is also fac­ing chal­lenges with the rise in en­ergy ef­fi­cien­cies, ac­cord­ing to oil re­fin­ing com­pa­nies.

Re­fer­ring to the lower fuel con­sump­tion re­sult­ing from the push in the au­to­mo­bile sec­tor for higher-en­ergy ef­fi­cient en­gines, San­jiv Singh, CMD, In­dian Oil Corporation (IOC), added, “In In­dia, the ma­jor shift that can hap­pen is the en­ergy ef­fi­ciency and change in busi­ness mod­els. We can­not ig­nore any change in the trans­porta­tion sec­tor, when they are driv­ing most of our de­mand.”

Khalid bin Khal­ifa AlThani, CEO, Qatar­gas, re­fer­ring to his firm’s ca­pac­ity ex­pan­sion plans said, “I do not think this is enough. More gas will be needed for the world de­mand.” Qatar­gas is ex­pected to take its cur­rent ca­pac­ity of 77 mil­lion tonnes (mt) to more than 100 mt by 2024.

He also added, along with gas in­fra­struc­ture de­vel­op­ment and pol­icy push, In­dia should look to bring the prod­uct un­der the goods and ser­vices tax pre­view. Oth­ers such as B C Tri­pathi, CMD, GAIL, “ex­pects the en­ergy bas­ket to go through a change, where the firm ex­pects re­new­ables and gas to dom­i­nate in the fu­ture.”

“In per­cent­age terms, the num­bers look high, but ab­so­lute num­bers would show a dif­fer­ent pic­ture. We should not be con­cerned about it. How­ever, we do re­alise the sit­u­a­tion is chal­leng­ing” SHASHI SHANKER CMD, ONGC

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