Petro-energy sector in India Scaling New Heights
Energy is a key enabler in supporting India’s economic growth. Currently, India is the third-largest energy consumer in the world. Our energy demand would grow three-fold by 2040. According to BP Energy outlook, India will be the key driver of global energy demand in the next 25 years. Against this backdrop, it is inevitable to have a glimpse at achievements of Ministry of Petroleum & Natural Gas under the stewardship of Dharmendra Pradhan.
- Pradhan Mantri Ujjwala Yojana (PMUY): This scheme has been launched with an aim to provide LPG connections to 5 crore women belonging to the Below Poverty Line BPL) families. Out of this, 30.5% and 13.3% connections have been issued to SC and ST categories respectively. Now the Government aims to provide these connections to the tune of eight crore.
- PAHAL: More than 19.12 crore LPG consumers have joined the PAHAL Scheme. PAHAL has entered into Guinness book of World record being largest Direct Benefit Transfer scheme. So far, more than Rs. 58243 crore have been transferred into the bank accounts of consumers. PAHAL has helped in identifying ‘ghost’ accounts, multiple accounts and inactive accounts. Estimated savings in subsidy due to implementation of PAHAL for FY 2014-15, 2015-16 and 2016-17 is nearly Rs. 29446 crores.
- Direct Benefit Transfer in PDS Kerosene (DBTK) Scheme: To bring reforms in Allocation and Distribution of PDS SKO distribution system, for better subsidy management, and also for reducing subsidy outgo by means of curbing diversion of subsidized kerosene, this scheme was launched. DBTK has been implemented in all districts of Jharkhand and 4 districts of Chhattisgarh. Other States have been requested to join the Scheme. Further, States/ UTs are encouraged to become `Kerosene Free’ by brining all households under LPG. So far, UTs of Delhi, Chandigarh, Daman & Diu, Dadar and Nagar Haveli & Puducherry and the States of Haryana, Andhra Pradesh & Punjab have become `Kerosene Free’.
- LPG Coverage: During 2016-17, more than 3.31 crore new LPG connections were released and during 2017-18 (upto 18.12.2017), more than 2.15 crore new LPG connections were released. As on 1.11.2017, National LPG coverage reached to 78.3% from 60.6% as on 11.1.2015. The government aims to provide 10 crore connections.
To increase the LPG coverage further, advertisement for selection of 6149 new LPG distributorships has been released in various states across the country and selection process is underway. As on 19.12.2017, draw for 2468 locations have been were conducted.
- Subsidy on Kerosene and LPG: The Oil Marketing Companies are currently incurring under recovery of Rs.12.44 per litre on PDS Kerosene and Government is providing cash compensation of Rs.252 per cylinder under DBTL.
- Automation at OMC ROs: To enhance customer confidence through Q&Q (Quality and Quantity) of fuel and minimizes chances of fraudulent transactions, this Ministry has given the target to OMCs to Automate all ROs selling more than 100KL/Month. As on 15.11.2017, out of 31155 ROs currently selling 100KL/Month, 21152 ROs have been automated.
- Promotion of Digital Payments Undertakn by MOP&NG: There has been a significant expansion of digital payment infrastructure at retail outlets. Around 82132 POS terminals and 81070 e-wallet facility have been provided at 49204 (90%) petrol pumps across the country, these Outlets cover more than 95% of sales.
- Exploration &Production
- HELP: The new Hydrocarbon Exploration Licensing Policy (HELP) for award of Hydrocarbon Acreages in the Upstream Sector of India was notified on 30th March, 2016 and formally launched w.e.f 1st July, 2017. Open Acreage Licensing Policy (“OALP”) is one of the key features of HELP which has been notified on 30.06.2017.
- Discovered Small Field Policy: The Union Cabinet approved 69 marginal fields for offer under Discovered Small Fields Policy. Out of these, 67 Discovered Small Fields were clubbed into 46 contract areas and put on offer. Based on the success of DSF
Bid Round-I, DGH has further identified 60 un-monetised discoveries / fields of ONGC and OIL in nomination regime and relinquished blocks of PSC regime.
- Survey of un-appraised areas of Sedimentary Basins of India: To generate seismic data for initiating Exploration and Production (E&P) activities, Government prepared a Project to conduct 2D seismic surveys of all sedimentary basins of India. The estimated cost of the project is Rs. 2932.99 Crore. Project will be completed by 2019-20. 2D seismic survey of 10,200.54 LKM has been carried out. Out of this ONGC has conducted survey of 1902.68 LKM and OIL has conducted survey of 697.86 LKM.
- National Data Repository (NDR): NDR has been set up at DGH to make the entire E&P data available for commercial exploration, research and development and academic purposes.
- National Gas Grid (Pradhan Mantri Urja Ganga): To have a gas based economy and enhance the share of gas in the energy basket to 15%, the Government has envisaged developing additional 15,000 km of gas pipeline network. At present, the natural gas grid in the country predominantly connects the western, northern and south-eastern gas markets with major gas sources. As a commitment to provide the clean energy in the Eastern part of the country, the Government has approved a capital grant of Rs. 5,176 Crore (40 per cent of the estimated capital cost of Rs. 12,940 Crore).
- City Gas Distribution Network: Prime Minister Shri Narendra Modi in Urja Sangam 2015 on 27.03.2015 at Vigyan Bhawan, New Delhi, said: “In the next four years, to increase Piped Line Gas Connection from 28 lakh connections to 1 crore connections to reduce pollution in the cities.” At present, 31 CGD companies are developing CGD networks in 81 GAs in 21 State(s)/UTs which are supplying clean cooking fuel in the form of PNG to about 40 lakhs in the country. Further, the Government has envisaged to expand the coverage of CGD networks across the country in synchronisation with the Gas availability and pipeline connectivity.
- Promotion of CNG/LNG in Transportation Sector: The Government is promoting the usages of environment friendly transportation fuel, i.e. CNG by expanding the coverage of City Gas Distribution (CGD) network in the country. In order to promote the CNG services in the country, the Government has issued guidelines for making available domestic gas to the CGD entities for meeting the entire requirement of CNG for transport segments.
Ujjwala bringing smile to poor rural women’s life
Liquefied Petroleum Gas (LPG) is no longer an urban phenomenon with only affluent and upper middle class households using it. Now, poorest of the poor families in India’s rural heartland are availing the benefits of LPG, thanks to Pradhan Mantri Ujjwala Yojana (PMUY).
The flagship social welfare scheme, which provides free LPG connections to women from BPL households, is a ground breaking success. The ambitious scheme was launched by Prime Minister Narendra Modi in Ballia district of Uttar Pradesh in May 2016. Such is the success of the scheme that out of the 10 crore LPG connections distributed in the last four years, a whopping four crore were allotted under Ujjwala Yojana. Further, of the four crore Ujjwala beneficiaries, 45 per cent are Dalits and Tribals.
Initially, Petroleum Ministry has set a target of providing five crore LPG connections, under Ujjwala Yojana, over a period of three years with an allocation of Rs 8000 crore. But in the wake of the popularity of the scheme, the Ministry has raised the target to 8 crore LPG connections with an additional allocation of Rs 4800 crore. Currently, 712 districts have been covered under the scheme. The scheme covers all SC/ ST households, most backward classes, beneficiaries of Pradhan Mantri Awas Yojana (Gramin), beneficiaries of Antyoday Anna Yojana, forest dwellers, people residing in river and river islands.
A World Health Organisation (WHO) report states that smoke inhaled by women from unclean fuel is equivalent to burning 40 cigarettes in an hour. According to WHO estimates, about 5 lakh deaths in India every year are caused by unclean cooking fuels.
The suffocating smoke released from unclean fuels causes alarming household pollution. This adversely affects the health of women and childen. The effect could be several respiratory diseases such as heart diseases, stroke, chronic obstructive pulmonary disease and lung cancer.
Ujjwala, meaning the bright, aims to illuminate the lives of millions of poor rural women. The impact of the scheme, which seeks to replace unclean cooking fuels with clean and efficient LPG, are three fold. One, it empowers millions of poor women of rural household. Second, it helps reduce the drudgery faced by the women of biomass cooking and the amount of time spent on it. Third, it provides employment to rural youth in the supply chain of cooking gas.
Under Ujjwala Yojana, the Central government provides a subsidy of Rs 1,600 to state-owned fuel retailers for each free LPG gas connection installed in every rural BPL household. The subsidy is meant for the security fee of the cylinder and the fitting charges. The LPG connection under the scheme is released in the name of the woman of the household.
The Petroleum Ministry has launched Pradhan Mantri LPG Panchayat to support the Ujjwala Yojana. The peer learning platform is an interface between the government and the Ujjwala beneficiaries where they discuss their experiences. Central government officials, Ujjwala beneficiaries, LPG distributors and NGOs come together in the LPG Panchayat. It spreads awareness among the Ujjwala LPG users about the benefits of consuming clean fuel. In a bid to give a further boost to Ujjwala Yojana, the Petroleum Ministry is targeting as many as one lakh LPG Panchayats this year.
Data shows that Ujjwala Yojana helps lowering rural inflation. Ever since the central government launched the Pradhan Mantri Ujjwala Yojana, the non-discretionary inflation in rural areas – which is essentially food, fuel and housing inflation – is on a decline.
The Ujjwala Yojana has increased India’s LPG consumption substantially. With eight per cent rise in LPG consumption in the financial year 2017-18, India has surpassed both US and Japan. Today India is the second largest LPG importer of the world after China.
Pertinent to mention that 10 crore new LPG connections were allocated in the last four years against 13 crore in six decades since Independence. Latest data suggests that 73 per cent household in India are currently under LPG coverage. The Modi government aims to increase the LPG coverage to 80 per cent households by March, 2019.
“To meet the rising demand, the government is expanding LPG infrastructure, setting up new bottling plants and raising number of distributors to 25,000 from current 19,223 in two years,” said Petroleum Minister Dharmendra Pradhan.
Ujjwala Yojana is one of the most successful schemes of the Modi governmnent. The scheme underscores Prime Minister Narendra Modi’s pro-poor credentials. Petrolium Minister Dharmendra Pradhan is steering the ambitious scheme all too well. Undoubtedly, the scheme is giving impetus to millions of poor rural women. It is helping them empowered socially. Ujjwala has certainly transformed the lives of poor rural women for the better.
By Saswat Panigrahi
- Augmentation of refinery sector: Out of the 23 refineries operation in the country, 18 are in public sector, 3 are in private sector and two as a joint venture with a total refining capacity of 247.566 MMTPA. Out of the total refining capacity of 247.566 MMT, 142.066 MMT is in the public sector, 17.3 MMT in joint venture and the balance 88.2 MMT is in the private sector. The country is not only self-sufficient in the refining capacity for its domestic consumption but also exports a sufficient quantity of petroleum products.
Auto Fuel Vision
- Auto Fuel Vision and Policy – Introduction of BS-IV & BS-VI fuels in the Country: The Government has implemented supply of BS-IV auto fuels in the entire country in phases. Further, the Government has also decided to leapfrog from BS-IV to BS-VI directly and a notification has been issued for implementation of BS-VI w.e.f. 01.04.2020 in the entire
country. However, considering the recent rise in environmental pollution in Delhi and NCR, the Government has preponed the implementation of supply of BS-VI w.e.f. 01.04.2018 in NCT-Delhi.
- EBP Programme: In order to improve the availability of ethanol, the Government revised the ex-mill price of ethanol for the ethanol supply year 2017-18 at Rs. 40.85/per litre. During 2015-16, OMCs procured 111 crore litres of ethanol (till 30.11.2016) which is an all-time record in the history of EBP. For 2016-17, OMCs have floated tender for the quantity of 278 crore litres of enthanol out of which 62.32 crore litres has been received till 14.11.2017.
- Biodiesel Programme: The Government, vide notification dated 29th June, 2017, has paved the way for direct sale of Biodiesel (B-100) for blending with High Speed Diesel to all consumers, in accordance with the specified blending limits and the standards specified by the Bureau of Indian Standards.
- 2nd Generation Ethanol through Lignocelluloses Route: Oil PSUs are establishing twelve 2G Ethanol plants in 11 States of the country. Six MoUs have been signed between Oil Marketing Companies and Technology Providers (5 MoUs) / State Government (1 MoU) for setting of 2G ethanol plants in five locations. Foundation stone of the first Biofuel refinery set up by Hindustan Petroleum Corporation Limited in Bathinda, Punjab, has been laid.
- International Cooperation: In line with government’s ‘Act East’ policy, there has been series of engagement in the hydrocarbon sector with the neighboring countries, various pipelines are being constructed to connect our gas grids with our neighbours like Bangladesh and Nepal. We have robust hydrocarbon trade with Nepal, Bhutan and Mauritius and have sent first test cargo of petroleum products to Myanmar. We are also working towards setting up an LNG terminal in Sri Lanka through an international JV company.
- Start-Up India: The oil and gas CPSEs have set up a Start-Up fund aggregating to Rs. 320 Crore for 3 years. They have also launched their Start-Up websites and have launched Innovation Challenges. 29 start-up firms have been selected in Phase-I.
- Skill Development: Under the Skill India initiative Hydrocarbon Sector Skill Council (HSSC) has been set up with a projected training plan for certification based skill development programmes and has identified a target of training approximately 7.3 lakh persons by 2022.
- Make in India: A Policy to provide Purchase Preference (linked with Local Content (PP-LC)) in all oil and gas PSUs has been approved by the Government to incentivize growth of local content in goods and services by implementing Oil and gas projects in India by providing purchase preference to the manufacturers/ servic providers.
- Ease of Doing Business: To ensure transparency and fairness the Oil and Gas PSUs were directed to consider incorporation of relaxation of Past Track Record (PTR) norm subject to meeting the quality and technical specifications (except procurement of items related to public safety, health, critical security operations and equipments etc.) to all Startups (whether MSEs or otherwise) in their procurement manuals.
- Engagement of Apprentices: PSUs have also been directed to prepare their action plans for increasing engagement of apprentices up to the level of 10% of the total workforce.
- Swachh Bharat Mission: The revised provision pertaining to availability of clean toilets has been classified under “Major irregularity” and the penalty provisions have also been suitably amended by the OMCs. As on 15.11.2017 OMCs have a total number of 55,413 ROs across the country,
out of which 54,441 ROs have toilet facility which includes separate
toilet facilities for gents and ladies at 30,886 ROs. OMCs are putting all efforts to provide separate toilet facilities for ladies and gents at all ROs, wherever feasible.
Uday India bureau