Companies

Indian Oil to sell off hydrogen generation units to raise cash

Our Bureau New Delhi | Updated on March 16, 2021

This is aimed to raise cash and improve the efficiency of these units by handing over operations to a private company

Indian Oil Corporation Ltd plans to sell the hydrogen generation units at its refineries to private operators, Petroleum and Natural Gas Secretary Tarun Kapoor said on Tuesday.

“Hydrogen producing plants in Indian Oil’s refineries will be given to the private sector to run. That process has already started,” Kapoor said.

Indian Oil will be the captive buyer of the hydrogen made by the sold unit, Chairman and Managing Director SM Vaidya said.

Indian Oil’s hydrogen generation unit in Gujarat, which has a production capacity of around 70,000 tonnes, would likely be the first to be put on sale, Vaidya said, adding that the sale is expected to be made by December.

The goal of the new round of sales is to raise cash and improve the efficiency of these units by handing over operations to a private company with expertise in the area, Vaidya added.

Asset value and O&M charges quoted by bidders will be among the factors used to determine the winner of the auctions for the units, Vaidya said.

Meanwhile, the asset monetisation of oil and gas pipelines is expected to take over a year to materialise, the secretary said.

In the future, petroleum would remain price competitive in advanced low-emission forms, Kapoor added. “India can be a leader in carbon capture. If we can bring emissions down to zero, there is no need for change. Fossil fuel is as good as any other fuel.”

Indian refiners may also pilot projects with hydrogen produced from carbon capture, utilisation, and storage technologies, also known as blue hydrogen, Kapoor added.

Published on March 16, 2021

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