The parliamentary standing committee on petroleum and natural gas has come down heavily on the Oil Ministry and its PSUs for showing “lack of seriousness” in setting up compressed biogas (CBG) projects in the country.

In a strong response, the committee said the Ministry of Petroleum and Natural Gas (MoPNG) failed to prevail upon its PSUs to set up CBG projects, which is important for demonstrating the viability of such projects and instilling confidence in investors, despite the same being recommended.

“The committee are not happy with this lack of seriousness being exhibited by the Ministry and Oil and Gas PSUs. Besides, the committee are concerned to note that the Ministry have not shown any interest to issue orders to Oil and Gas PSUs for investing in creating and maintaining infrastructure for promotion of CBG projects which create a doubt that the Ministry itself is sceptical about the viability and success of the CBG projects,” it said.

The panel emphasised that unless Oil and Gas PSUs “shed their reluctance” and come forward in investing in a few CBG projects, it will be difficult to persuade private entrepreneurs and investors to come forward and invest in the CBG sector.

The report is on the action taken by the government on recommendations made in the 17th Report (17th Lok Sabha) of the standing committee on petroleum and natural gas on review of implementation of CBG (SATAT), which was placed in Parliament on December 21, 2022.

The government’s Action Taken Replies were received on April 20, 2023, and the panel considered and adopted the report on July 27, 2023, which was then placed in Parliament on August 1.

Lack of interest

The committee in its original report had suggested that Oil PSUs should “aggressively” enter into CBG sector through company owned company operated (COCO) model or joint ventures with other OMCs/ entrepreneurs.

In its response, the MoPNG said “oil and gas marketing companies (OGMCs) have been investing in creating and maintaining infrastructure for promotion of CBG projects which include development of Retail Outlet, laying of pipeline, purchase of equipment, etc. Further, they are also investing in establishment of CBG plants.”

However, the panel was not happy with the response of the Ministry and countered that the Ministry is trying to “mislead” it.

“The committee are not satisfied with the reply of the Ministry as it does not mention any new measure taken by Oil PSUs in this regard and has rather resorted to mislead the committee by furnishing the details of the CBG projects that are already being undertaken by IOCL, HPCL and GAIL,” it added.

The panel reiterated its earlier recommendation and stressed that the Ministry should persuade the Oil and Gas PSUs to consider and make investments in new CBG projects with their own funds and “seriously pursue” their implementation.