India’s state-controlled Oil & Natural Gas Corporation (ONGC) and joint venture partner Greenko are poised to spend up to $6.2 billion on renewable energy and green hydrogen projects under the terms of an agreement signed Tuesday, Press Trust of India (PTI) has reported.
The investment, part of ONGC’s ambitious decarbonisation drive, could lead to the development of 5.5 to 7 gigawatts of solar and wind power projects, along with plans for producing green hydrogen, the news agency said, quoting unnamed officials from ONGC.
The two players inked a memorandum of understanding on 26 July “to jointly pursue opportunities in renewables, green hydrogen, green ammonia and other derivatives of green hydrogen”, ONGC said, without disclosing further details on the specific projects.
The green energy deal is likely to be valid for a two-year period, the company noted.
Joint venture plans
ONGC’s agreement with Greenko, one of India's largest renewable energy companies, is aimed at forming a 50:50 joint venture for green energy projects, Upstream understands.
PTI noted the joint venture will set up renewable energy capacity and use the generated power to split water in an electrolyser to produce green hydrogen, which in turn would be used for manufacturing green ammonia.
It added that the renewable plants, together with Greenko’s pump storage power generation system, will give 1.4 GW of “round-the-clock electricity” that would be used to produce 180,000 tonnes per annum of green hydrogen.
The joint venture is expected to effectively produce 1 million tpa of green ammonia as a part of the agreement.
The renewable energy component of the chain would cost about $5 billion, while the hydrogen and ammonia plant would require an additional $ 1.2 billion.
Green hydrogen push
Indian private sector giants like Reliance Industries and Adani have already announced billions of dollars in investments to set up green hydrogen projects.
ONGC’s foray into the sector is in line with India’s National Hydrogen Mission, which is aimed at making India a global green hydrogen hub, ONGC said.
“The activities envisaged under this MoU will contribute towards India’s target of producing 5 million tonnes of green hydrogen per annum by 2030,” the company added.
ONGC said it is looking to de-risk its oil and gas portfolio against “long-term disruptions” and aims to reduce its carbon footprint by moving into renewable energy.