Natural Gas improving in the energy Mix in India?
As per the US Energy Information Administration (EIA) of mid-2020, by 2030 natural gas share in the energy mix in India is expected to go up to 15% from the current level of 6/7 %. This projection is consistent with Gov. aim to reduce crude import by 10% by 2025 by adding more CGDs across the country for increasing distribution of natural gas.
Two major segments of CGD projects, CNG and residential, are entitled to priority allocation of domestic gas as per Govt. gas allocation policy and are least dependent on RLNG. Further, upstream companies are expected to boost gas production from 2020-21 onward. These deep-water projects have got potential of supplying 350 billion cubic feet of gas annually over a period of 15 years.
Focus is also on a sustainable alternative (under SATAT scheme) as compressed bio-gas (CBG), which is similar to CNG in heat and methane content. India has got potential of producing about 62 million tons of CBG annually besides producing organic manure as a bonus and value addition. Going forward, Biogas distribution can be easily integrated into the CGD network.
Accordingly, it is expected that CGD's dependence on LNG would not be so significant . GAIL along with GSPL has got long-distance pipelines in place beside the E/W pipeline laid by RIL and Urja Ganga gas pipeline that negotiates through WB, Orissa, Jharkhand, Bihar would provide gas connectivity to these regions too. Of 150 + odd CGDs recently authorized, 126 can be served by existing cross-country pipelines.
Central Govt. is very keen to cover natural gas under GST and it may be sooner than later. CNG and residential segments may continue to hold promise driven by the Govt. policy.
Abhishek Singh
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