India’s Oil and Natural Gas Corp. (ONGC) plans to invest 2 trillion rupees ($24.2 billion) to reach net-zero carbon emissions on an operational level by 2038, according to Bloomberg, citing ONGC Chairman Arun Kumar Singh in an Aug. 29 press briefing.
“It is not a story of ‘or’ but an ‘and’ story,” said Singh. “We have financial muscle to invest in both hydrocarbons and new energy.”
About half of the planned investment will be made by 2030 in building 10 gigawatts of renewable power capacity, green ammonia, and hydrogen projects. ONGC has already signed onto a 5 gigawatt solar project in Rajasthan and will be adding another 5 gigawatts through wind and solar projects.
“Carbon markets are in the offing,” Singh said. “There is opportunity in export of green fuels. The financing cost of clean energy projects is also low.”
ONGC’s plans to become net-zero at the operational level – called Scope 1 and Scope 2 emissions – is in line with its peers globally. Billionaire Mukesh Ambani on Aug. 28 said his plans use solar and offshore wind, among others, to make Reliance Industries net-zero by 2035.
India’s largest oil and gas producer has been battling declining oil reserves and output for years. That production decline has impacted its earnings.
Singh said the company still has capability to raise as much as 5 trillion rupees from the market. During a presentation on Aug. 29, ONGC said declining output will find reprieve after oil and gas production starts from the offshore East Coast Block KG-DWN-98/2.
The company will begin producing oil from the block by October or November with an initial output of 10,000 barrels/day. Output is then set to expand to 20,000 barrels/day by March and will hit a peak of 45,000 barrels/day in the fiscal year ending March 2025, the company said in the presentation. Gas production will start by mid-2024.
ONGC has also started looking for oil and gas in the Mahanadi basin in the eastern offshore, Singh said. “The company and country are very optimistic on eastern offshore,” he said.