It is important for India to continue investing in the upstream sector to bolster oil and gas production, Mannish Mahesshwari, CEO of Invenire Energy, told S&P Global Commodity Insights.
He said that the investment is necessary to potential supply shortages and fluctuations in energy prices while embracing environmentally friendly technologies.
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“Flipping the lens to energy security, sustained under-investment in upstream without substitutional capacity and substantial scale in clean and new energy could have far-reaching consequences in the journey of just transition,” Mahesshwari said.
Invenire Energy is looking to accelerate the production of oil and gas. “We are putting our money where our mind is. As a company, our ability to understand the rocks and the molecules is relatively better than the electrons. We are investing in today’s energy system, which is mainly oil and helping in phasing out coal with the help of low-carbon gas,” Mahesshwari said.
He said that the transition to a net zero world is more certain today than envisaged in 2015, the year of the Paris Agreement. However, the uncertainty around the energy transition pace adds complexity and risk for upstream projects. The upstream industry has avoided spending on projects that would lock in heavy emissions for years or quickly become stranded assets.
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“The upstream industry’s main focus now is to deliver the supply required to meet demand. Most of the industry’s oil and gas investment for the rest of this decade will target advantaged resources — those with the lowest cost, least risk, and possibly lowest Scope 1 emissions. Beyond this decade, to meet demand, the industry will depend increasingly on late-life reserves growth from legacy supply sources.” Mahesshwari said.
Mahesshwari emphasized the importance of adopting a balanced perspective on the energy transition. He noted that any deficiency in upstream investments could increase supply challenges and contribute to fluctuations in energy prices, as observed in recent times.
“The potential in carbon capture utilization and storage is enormous, and the oil and gas sector has unique skills that make it ideally placed to lead in reducing CO2 and methane emissions and decarbonize hard-to-abate sectors through carbon upcycling,” Mahesshwari said.
