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Indian Oil, OIL team up on CCUS-EOR project
PROJECTS & COMPANIES
INDIA’S largest oil refiner Indian Oil has teamed up with state-run developer Oil India Ltd (OIL) on a project to reinject refinery carbon emissions at a nearby mature oil project.
Indian Oil announced on January 10 that the two companies had signed a memorandum of understanding (MoU) on the enhanced oil recovery (EOR) project in the north-eastern state of Assam.
Under the agreement, the companies intend to install a carbon capture, utilisation and stor- age (CCUS) system at Indian Oil’s refinery in the town of Digboi. The goal is to capture car- bon dioxide (CO2) emissions from the refin- ery’s hydrogen generation unit and gas-fired power plant and the deliver them for reinjection at OIL’s Nahorkatiya and Dikom oilfields, which lie around 50-60km from Digboi.
Indian Oil’s director of refineries, SM Vaidya,
said: “Carbon capture for EOR extends the pro-
ductivity of mature oilfields and is in line with
our Prime Minister’s [Narendra Modi] clarion
call for reducing crude oil imports. It is also a
step in the direction of mitigating ‘climate emer-
gency’thatourplanetfaces.” Brentcrudepriceshavetopped$70perbarrel
The International Energy Agency (IEA) predicted on January 10 that India’s oil demand growth was set to overtake China by the middle of the decade. The agency said in its India 2020 Energy Policy Review that demand was expected to climb from 4.4mn barrels per day in 2017 to 6mn bpd by 2024, while domestic production would only expand marginally.
India’s oil production has been in steady decline for a number of years, which has prompted the government to implement a wave of upstream reforms that include improved gas pricing and marketing freedoms. However, it is likely to take a number of years before the benefits of these changes are felt. In November,
amid rising tensions in the Middle East, which saw Iran shoot down a Ukrainian passenger plane last week. India already imports more than 80% of its oil demand, with almost two thirds of that coming from the Middle East. As such, regional tensions have the South Asian country’s energy planners worried.
Commenting on the impact of geopolitical instability at the release event of the IEA report, Indian Minister of Petroleum and Natural Gas Dharmendra Pradhan said: “Today, we are meeting in the backdrop of rising tensions in the Middle East and [their] impact on stability and security in the region. We remain deeply concerned about the crude oil price volatility.”™
crude production slipped by 5.98% year on year to 2.61mn tonnes (638,000 bpd), while produc- tion in the first eight months of financial year 2019-2020 shrank by 5.85% to 21.72mn tonnes (652,000 bpd.)
The IEA noted that a deepening dependency on foreign oil would leave the Indian economy “even more exposed to risks of supply disrup- tions, geopolitical uncertainties and the volatility of oil prices.”
Indian LNG demand supports spot prices
PERFORMANCE
INDIA’S demand for liquefied natural gas (LNG) is helping drive spot prices for the fuel higher, according to a report by Reuters.
The average price on the spot market for LNG delivered in February to East Asia climbed by $0.15 per mmBtu ($4.15 per 1,000 cubic metres) to an estimated $5.30 per mmBtu ($146.60 per 1,000 cubic metres) on January 10, the newswire said the same day, quoting unnamed trading sources.
The sources added that the price for cargoes delivered in March was estimated at $4.75 per mmBtu ($131.39 per 1,000 cubic metres).
This comes on the back of other Reuters reports that Bharat Petroleum Corporation Ltd (BPCL), Indian Oil, GAIL (India) and GSPC were all looking for cargoes for delivery over the next few months.
S&P Global Platts reported at the start of the year that GAIL intended to import 90 LNG
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