Union Minister for Petroleum and Natural Gas Hardeep Singh Puri clarified that Rs 35,000 crore earmarked for energy transition and energy security in this year’s Union budget would be used for green energy capex by oil companies and increasing India’s strategic petroleum reserves.

In his Budget speech on February 1, Finance Minister Nirmala Sitharaman said the budget had provided priority capital investment of Rs 35,000 crore for the Ministry of Oil and Gas to achieve energy transition and net zero targets and energy security.

The announcement sparked speculation that the amount could include compensation for losses incurred by the Oil Marketing Company (OMC) due to an earlier price freeze. Another item that confuses industry insiders is whether the Rs 30,000 crore mentioned in the budget as capital support for the ministry is part of it.

According to media reports, Puri clarified the matter, saying that the Rs 35,000 crore includes capital support of Rs 30,000 crore, which is not the amount given to OMC by the government to cover earlier losses.

“Out of this Rs 35,000 crore, I think Rs 5,000 crore is earmarked for increasing the Strategic Petroleum Reserve. The other one, I think, yes, the finance minister is right. It is capital expenditure,” Puri said at India Energy Week on Tuesday told the media during the period.

The minister also clarified that this is a separate budget allocation and does not include the earlier compensation given to oil marketing companies to cover their losses due to insufficient recovery.