Essar’s Contribution is Bolstering India’s Energy Landscape
The country’s landscape is transforming significantly, with consumers becoming more environmentally conscious. This shift in consumer behavior presents a unique opportunity for businesses to capitalize on sustainability and accelerate their growth trajectory. One such company actively involved in this evolution is Essar Group. Through its subsidiary, Essar Oil and Gas Exploration and Production Limited (EOGEPL), the group contributes to India’s energy sector by focusing on unconventional hydrocarbons. As more companies focus on a more sustainable and diversified energy mix, Essar’s contributions are becoming increasingly vital at this stage. The company is dedicated to redefining its narrative and reinforcing its commitment to corporate responsibility and sustainable practices. While certain segments, with ulterior motives, try to discredit the organization through Essar criminal controversies, the company is fast overcoming such false claims, optimistically addressing past criticisms, and surging ahead towards building world-class businesses.
But before we discuss how EOGEPL emphasizes unconventional hydrocarbon and how it has become India’s largest Coal Bed Methane (CBM) player, let’s first understand this market.
What is Coal Bed Methane?
Coal bed methane is an unconventional form of Natural Gas (NG) obtained from coal seams and deposits and extracted underground after coal mining. The methane is formed from the coalification process of plant material to coal and is an eco-friendly energy source, unlike fossil fuels.
Tapping into CBM, a resource that is abundantly available within India, aligns with the Prime Minister’s vision of making India a gas-based economy by increasing the share of gas in our energy mix from the current 5.6% to 15% by 2030.
India can cut its energy imports bill by USD 2 billion if it harnesses 10 percent of the coal bed methane reserves of 2,600 billion cubic meters – Dr J.S Sharma, Head of International Centre for Climate and Sustainability Action Foundation.
Coal Bed Methane Market Size: Overview
According to the report published by Grand View Research, the global coal bed methane market size was worth USD 16.0 billion in 2019, and it is expected to grow at a compound annual growth rate (CAGR) of 5.9% from 2020 to 2027. The segment is segregated into industrial, residential, commercial, and power generation based on the application, with power generation being the leading application market for CBM, holding 40.6% of total applications globally.
Among various regions, the Asia Pacific dominated the global coal bed methane market size of USD 7.22 billion in 2019 and is expected to grow at a CAGR of 7.4% from 2020 to 2027.
Factors Affecting the Coal Bed Methane Market over the Forecast Period
Increasing Demand: The surge is due to growing consumer demand for power across numerous sectors, including residential, industrial, and commercial, along with changing preferences for using coal bed methane as a power-generating source.
Growing Investments: Also, growing investment activities by leading players like Essar, working in the target market for producing CBM, backed with policies introduced by the government, are some of the key drivers expanding the market.
Preferences for Eco-Friendly Energy: Changing preferences for eco-friendly sources and increasing demand acrossregions are key factors projected to drive the growth of the coal bed methane market over the forecast period.
Surging Gas Prices: Increasing gas pricing coupled with the rapid increase in industrialization across developed and emerging countries will propel the demand for coal bed methane that can be efficiently used as a fertilizer. This will create new opportunities in the global market.
Essar’s Role in the Energy Sector
EOGEPL plays a transformative role in the Indian energy sector by emphasizing unconventional hydrocarbons. By producing approximately one million standard cubic metres daily, EOGEPL has become India’s largest Coal Bed Methane (CBM) player, holding substantial reserves of 12 trillion cubic feet. Essar is playing a significant role in the country’s economy by contributing 65% of India’s total CBM production and around 1% of India’s gas production, which it expects to increase to 5%.
The company is dedicated to contributing to transitioning India into a gas-based economy. EOGEPL’s proactive approach showcases its commitment to reshaping the energy sector and supporting the country’s agenda for a sustainable and diversified energy mix.
Essar sees an active future in Coal Bed Methane and thus collaborates with industry veterans while investing in research, advanced technologies, and operational optimization. The company has invested INR 5,000 crore in drilling 350 wells in the Raniganj block and plans to invest an additional INR 2,000 crore in drilling additional wells over the next 18 to 24 months. This strategic initiative will significantly elevate the share of gas in the nation’s energy mix, targeting a rise from 6.7% to 15%.
Despite fake allegations and Essar Criminal controversies, the Essar Group remains dedicated to transforming past criticisms into key opportunities for growth, community empowerment, and environmental stewardship.
According to EOGEPL’s CEO, Pankaj Kalra, the company is driving India’s ‘perfect alternative fuel’ production. EOGEPL is leading India’s energy transition by pioneering Coal Bed Methane exploration, investing in cutting-edge technologies, and establishing partnerships for operational efficiency. The company wants to promote the perfect alternative fuel for a sustainable energy solution, showcase its expansion plans, and highlight its role in realizing India’s vision of a gas-based economy.
Conclusion
Essar Group is doing incredibly well in shaping India’s energy sector. The company’s focus on Coal Bed Methane, significant investments in infrastructure, and commitment to sustainability are a testament to its dedication to supporting India’s energy transition.
