DECEMBER 20248HPCL INCREASES OIL IMPORT QUOTA FROM IRAQ BY 43 PERCENTOIL SUBSIDIES REFORMED TO PAVE THE WAY FOR RENEWABLE ENERGY INVESTMENTSHindustan Petroleum Corp Ltd (HPCL), India's state-owned oil company, plans to increase its annual crude oil import from Iraq to 100,000 barrels per day (bpd) in 2025, a rise of approximately 43 percent from its 2024 deal of 70,000 bpd, according to a company source.This increase aligns with HPCL's ongoing refinery expansions. The company is commissioning residue upgradation units at its Vizag refinery in southern India, raising its capacity from 274,000 bpd to 300,000 bpd. HPCL also operates the 190,000 bpd Mumbai refinery in western India and expects to begin operations at its new 180,000 bpd Barmer refinery in Rajasthan by late December or early next year.These expansions will bolster HPCL's refining capacity, supporting its increased crude imports and enhancing its ability to meet domestic fuel demand.HPCL, an Indian PSU in petroleum and natural gas sector, is based in Mumbai. It is a branch of the Oil and Natural Gas Corporation (ONGC), which is government-owned by India and managed by the Ministry of Petroleum and Natural Gas. Since 2018, Oil and Natural Gas Corporation has majority ownership of its stake. HPCL has a IT infrastructure in place to aid its primary operations. The HITEC City in Hyderabad houses the data center. India has made significant strides in reforming fossil fuel subsidies, reducing support for the oil and gas sector by 85 percent, from $25 billion in 2013 to $3.5 billion in 2023, according to a statement from the Ministry TOP STORIESof New and Renewable Energy (MNRE). Following a "remove, target, and shift" strategy, India has steadily cut down on subsidies since 2010 by adjusting retail prices, tax rates, and subsidies for specific petroleum products. This transformation has freed up fiscal resources, allowing the government to invest in renewable energy and sustainable infrastructure.Key reforms included the phasing out of petrol and diesel subsidies from 2010 to 2014, followed by tax hikes on these fuels until 2017 during periods of lower global oil prices. These tax revenues were strategically redirected to fund liquefied petroleum gas (LPG) subsidies for rural communities, aiming to support environmental and social welfare objectives.With these subsidy cuts, India has increasingly directed funds towards clean energy projects, including solar parks, distributed energy solutions, and the expansion of electric vehicle infrastructure. The MNRE emphasized that India's approach serves as a model for other countries seeking to reduce dependency on fossil fuels, pointing to an ongoing investment in clean energy solutions and grid-strengthening initiatives. The gradual subsidy reduction has laid the groundwork for an accelerated transition toward renewable energy, with fiscal room now available to support large-scale, sustainable projects.
< Page 7 | Page 9 >