Whalesbook
ONGC Pioneers Carbon Capture in Landmark Gujarat Pilot
Oil and Natural Gas Corporation (ONGC) has initiated its first full-scale Carbon Capture and Storage (CCS) pilot project at the Gandhar oilfield in Gujarat. This significant undertaking marks a major stride in the company's strategy to decarbonize its operations and contribute to India's ambitious climate goals.
The Core Issue
The pilot project involves utilizing two abandoned onshore wells at the Gandhar field to inject approximately 100 tonnes of captured carbon dioxide (CO2) per day directly into subsurface hydrocarbon reservoirs. The CO2 is sourced from nearby industrial facilities in the Dahej region and ONGC's own Hazira plant. By storing the CO2 underground, ONGC aims to prevent this potent greenhouse gas from entering the atmosphere, a critical step in mitigating climate change.
Financial Implications
This initiative is part of ONGC's broader commitment to investing USD 12 billion in carbon capture and energy transition projects. The company aims to achieve net-zero emissions across its Scope 1 and Scope 2 operations by 2038. The successful implementation of CCS technologies could unlock long-term strategic value and operational gains, supporting India's broader energy transition.
Future Outlook
The Gandhar pilot project is designed to test the scalability and integrated approach of Carbon Capture, Utilisation, and Storage (CCUS) for hard-to-abate industrial sectors. Beyond storage, ONGC is exploring the potential of using CO2 to enhance oil recovery (EOR), effectively transforming a harmful emission into a productive resource. This could significantly boost oilfield productivity. ONGC has also entered into a Memorandum of Understanding with Shell to cooperate on CCUS studies, including CO2 storage and EOR assessments.
The project will also serve as a foundation for producing blue hydrogen, a cleaner energy source. ONGC plans to engage specialized CCUS consultants to provide technical advisory, regulatory guidance, and feasibility studies, ensuring the safe and effective deployment of this technology.
Impact
This CCS pilot is a crucial demonstration of India's commitment to reducing emissions and pursuing a sustainable energy future. It positions ONGC as a leader in adopting advanced environmental technologies within the Indian energy sector. The project's success could encourage further investment and policy support for CCUS initiatives across the country, directly impacting ONGC's environmental, social, and governance (ESG) profile and potentially influencing investor sentiment.
Impact Rating: 8/10
Difficult Terms Explained
Carbon Capture and Storage (CCS): A process that captures carbon dioxide emissions from industrial sources or the atmosphere and stores it underground, typically in geological formations, to prevent it from entering the atmosphere.
Greenhouse Gas: Gases in Earth's atmosphere that trap heat, contributing to global warming. Carbon dioxide (CO2) is the most significant human-caused greenhouse gas.
Net Zero: A state where the amount of greenhouse gases produced is balanced by an equal amount removed from the atmosphere, resulting in no net increase.
Scope 1 and Scope 2 Emissions: Scope 1 emissions are direct emissions from owned or controlled sources. Scope 2 emissions are indirect emissions from the generation of purchased electricity, steam, heating, or cooling.
Enhanced Oil Recovery (EOR): Techniques used to increase the amount of crude oil extracted from a reservoir after primary and secondary recovery methods have been depleted. Injecting CO2 is one such method.
Blue Hydrogen: Hydrogen produced from natural gas or other fossil fuels through a process like steam methane reforming, where the resulting carbon dioxide emissions are captured and stored.
Hard-to-abate sectors: Industrial sectors, such as cement, steel, and chemicals, where emissions are difficult to eliminate through traditional decarbonization methods like electrification due to process requirements.
Saline Aquifers: Underground rock formations containing porous rock saturated with salty water, considered a suitable geological environment for long-term CO2 storage.
Memorandum of Understanding (MoU): A formal agreement between two or more parties outlining the common goal and scope of cooperation.