Petroleum ministry to divert more natural gas from non-core sectors

Aims to boost capacity to core sector by 9.2 mscmd

Another cut in natural gas supply from non-core industries such as refineries, non-urea fertiliser plants and iron and steel units is in the offing, with a view to diverting the resource to the core sector.
 
According to official sources, the petroleum ministry has planned to increase the supply of natural gas to CNG and PNG sector by another million standard cubic metres a day (mscmd) from 8.2 mscmd to 9.2 mscmd. This is in keeping with the commitment of the government to meet the entire requirement of city gas distribution (CNG) and Piped natural gas (PNG) through domestic gas supply.  

 
According to the sources, the ministry has identified areas where supply can be cut and has informed the relevant ministries for immediate stoppage after due notice. The underlying objective of this diversion is to allocate the natural gas on priority to those areas where the direct beneficiary is the consumer.  Accordingly, sectors like petrochemicals, refineries and steel, besides industrial & commercial consumers drawing gas beyond a certain threshold will have to go for more expensive imported gas.
 

To this effect, the Ministry of Petroleum and Natural gas has formulated a comprehensive plan to augment the supply of natural gas in the country.

As per the plan, the capacity will be augmented through a combination of re-gasification of LNG terminals and domestic output. RLNG capacity is expected to grow from 61.2 million standard cubic metres per day (mmscmd) at present to 147.6 mmscmd in 2016-17 in a phased manner. Similarly, domestic production of natural gas is expected to firm up to 150 mmscmd from 100 mmscmd at present by 2017-18. This plan had been discussed at interministerial meeting to apprise various users of natural gas on its availability during last government regime and now it will be presented again while discussing the plan for allocation of natural gas to the new cabinet, said sources.

Re-gasification refers to imported natural gas at LNG terminals. According to official sources, by the end of 2013-14, the availability of the regasified liquefied natural gas (R-LNG) is expected to grow accordingly from the present capacity of 61.2 mmscmd to 79.2 mmscmd by the end of 2013-14. This is primarily due to increase in capacity of Kochi terminal of Petronet LNG by 5 million tonne per annum (MTPA). This project received its environmental clearance and  coastal regulation zone clearance in January 2013.

Explaining the units, officials said that one MMPTA equals 3.6 mmscmd.  
 
While the re-gasification capacity remains the same at 79.2 mmscmd in 2014-15, the capacity of imported gas is expected to grow substantially in 2015-16 to 102.6 mmscmd. This is due to an increase of Dhabol LNG  terminal by additional 3 MMPTA to 5 MMPTA and fresh 3.5 MMPTA  re-gasification at Kakinada terminal of Andhra Pradesh Gas based power Plants (APGPCL).    

In 2016-17, the capacity of imported gas is further expected to grow to 147.6 mmscmd. Apart from the existing terminals,  this increase is attributed to additional new capacity of 5mmpta  at Gangavaram port, Andhra Pradesh and 5 MMPTA additional capacity of Petronet Dahej terminal. After the addition of  5 MMPTA capacity, Petronet Dahej increases its re-gasified LNG facility  to 15 MMPTA from existing 10 MMPTA. Similarly, another capacity addition will be at Hazira LNG from existing 5 MMPTA to 7.5 MMPTA.

This accounts for increase in supply of RLNG in the country through fresh units and additions to existing terminals, officials said.

Production of natural gas in the country is expected to go up by combined output of KG-D6 basins and increase in output of natural gas by state owned Oil and Natural Gas Corporation( ONGC) and Gujarat State Petroleum Corporation (GSPC). Officials added, ONGC in particular is expected to generate 35 MMPTA of output by 2017-18.