Atmanirbhar Bharat: Boosting swadeshi steel for oil & gas sector
Steel 360 , Jun 16, 2020
Organised by the Ministry of Steel in collaboration with the Federation of Indian Chambers of Commerce and Industry (FICCI), a webinar, entitled “Atmanirbhar Bharat: Fostering Domestic Steel Usage in Oil & Gas Sector” was held to foster domestic steel use in the fast-growing oil and natural gas sector.
Attended by the Union Minister of Petroleum and Natural Gas and Steel Dharmendra Pradhan and Minister of State for Steel Faggan Singh Kulaste, the webinar brought captains of both the steel and oil and gas industries on one podium to deliberate on cross-sectoral synergies and ways of boosting swadeshi steel with the aim of import substitution.
Pradhan stressed on enhancing domestic steel usage and reducing import dependence for meeting the oil and gas sector’s steel requirements. He said that steel and oil & gas sectors have close linkage, and it is time to take it to a new pedestal.
Addressing the participants, Pradhan said, “India is moving ahead with a new confidence and the country’s economy is slowly coming back on track after the COVID-19 onslaught. I was reviewing sales of petrol and diesel in the first 15 days of June and the petroleum department has informed me that demand is down by 80-85% on the year. India is the second largest steel maker and the third largest energy consumer.
Today India has about 250 million tonnes of refining capacity. In the coming 10 years this capacity will go up to 450-500 MnT. Visakhapatnam, Mumbai, Paradip, Panipat refineries are being expanded. Work on a new refinery at Barmer is advancing rapidly. We are going to start the West Coast Refinery soon. Chennai Petroleum Corporation Limited (CPCL) is starting its refinery’s expansion plan at Nagapattinam. A new pipeline network is growing rapidly. All this will boost steel consumption and demand for steel-based equipment will increase.”
“About 5,000 new factories of compressed biogas will be set up and each unit will cost around INR 30-40 crore. The material component to be used is steel. Steel pipes, plates and structurals producers will benefit. After all, the Pradhan Mantri Ujjwala Yojana directly benefited hot plate manufacturers,” he said.
The minister said that there has been tremendous growth in refineries, pipelines, gas terminals, storage capacity, gas cylinders, retail outlets, and all these require large amounts of steel. The oil and gas sector is one of the largest end users of steel pipes and tubes, with pipelines being the major mode of transport for petroleum, oil and lubricants. Expansion of the city gas distribution network to cover 70% of our population, refining capacity augmentation, plan to set up 10,000 CNG stations – all will drive steel demand.
Kulaste said that both the steel and oil and gas sectors are important pillars of the Indian economy and both have an important role to play as India moves towards USD 5 trillion economy. He called upon the industry to overwhelmingly adopt indigenous products and contribute to the nation’s development.
“Certain properties of steel such as high-pressure resistance and high-temperature resistance make it ideal for the challenging requirements in the field of exploration and production. Schemes such as the PM Awas Yojana and highway and urban development projects will boost steel demand. I have been told that the oil and gas sector, which consumed about 3 million tonnes of steel in FY19, is set to consumption to 3.8 million tonnes by FY24 and by 2031 it is expected to increase to 6.5 million tonnes,” he said.