Mumbai : The government is working to create a natural gas-based economy to ensure India is able to meet its commitment towards reducing emissions and target of reducing imports of crude oil, Oil Minister Dharmendra Pradhan said in the ministry’s monthly newsletter.
“On the path to make ourselves energy-rich, it is important to protect our environment. Our Government is working towards creating a natural gas based economy in the country, which is not just cost effective but also in sync with our commitment towards cleaner environment as made in COP 21,” Pradhan said.
At the Paris Climate Change summit in December, 195 countries including India agreed to a long-term goal of limiting global warming to “well below” 2 degrees celsius over pre-Industrial Revolution levels. This would require reduction in use of fossil fuels and increase focus on green and renewable resources.
India, the fourth-largest consumer of petroleum products, has proven natural gas reserves of 47 trln cu ft and estimated shale gas reserves of 96 trln cu ft. India currently imports nearly 79% of its petroleum needs. Natural gas currently accounts for just around 7% of total energy consumption in India.
New Delhi: For the first time in over four decades, the government is likely to convert a cess on domestically produced crude oil into an ad-valorem rate from a fixed per tonne levy, at present. The Budget for 2016-17, the second full year Budget by Finance Minister Arun Jaitley is likely to make changes in the way Oil Industry Development Cess is levied to provide relief to companies like ONGC and Cairn India that are being battered by oil prices plunging to 11-year low. “There are indications the Budget may announce an ad valorem rate of cess instead of Rs 4,500 per tonne fixed levy currently,” a senior government official said. The ad valorem rate of cess will results in higher payouts when prices are high and lower when rates fall.
