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India's natural gas demand to increase by around 55% to 378 mmscmd by 2016-17

25 Apr 2014 Evaluate

India’s natural gas demand is expected to increase by over 55 percent to 378 million standard cubic meters a day (mmscmd) by 2016-17 from 242.66 mmscmd in 2012-13 and more than double to 516.97 mmscmd in 2021-22, according to the report of the Petroleum and Natural Gas Regulatory Board (PNGRB).

The report highlighted that gas availability in the country will remain way short of the requirement. Indian natural gas production will rise to 182 mmscmd by 2021-22 from 101.1 mmscmd in 2012-13 while import of liquified natural gas (LNG) is projected to jump from 44.6 mmscmd to 188 in the reported period. Further, with an estimated 188 mmscmd gas imports, together with production of 182 mmscmd from domestic fields and another 30 mmscmd coming from the TAPI pipeline, the total supplies will be 400 mmscmd, far less than 516.97 mmscmd demand in 2021-22.

However, it added that India’s natural gas sector is growing at robust pace mainly driven by increased exploration efforts, commissioning of LNG import terminals, development of a nationwide natural gas pipeline grid and increasing demand. The PNGRB projected India’s gas output to around 211 mmscmd by 2026-27 on the back of desired policy support and correct pricing signals. Meanwhile, the report highlighted the need for the country to support speedy development of natural gas infrastructure through enabling environment that includes reforming the present set of regulations, addressing the distortions in the fiscal regime applicable for natural gas and correct pricing policies for investment in the sector.

The government is taking various measures to cut India's dependence on imports through intensive exploration and exploitation of untapped reserves. India will offer at least 56 oil and gas blocks under the 10th round of NELP auction under completely revamped terms. Presently, only 0.93 million sq km area in India is held under exploration and production in 19 basins as compared to total estimated sedimentary area of 3.14 million square kilometres, comprising 26 sedimentary basins.

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