The country’s natural gas imports rose 12.7 per cent during the April-October period as the fall in domestic output failed to cater to the hike in demand.
The country’s import basket was made up mainly by supplies from Qatar (47 per cent), Nigeria (17 per cent), the US (six per cent), Angola (six per cent) and Australia (six per cent).
Regasified LNG catered to 47 per cent of the country’s consumption during this period.
Onshore fields make up 31 per cent of the country’s natural gas production.
The rest is accounted for by offshore fields. On a year-on-year basis, consumption of natural gas shot up by 17.1 per cent between April and October this year.
Demand for natural gas is largely driven by fertilisers (28 per cent), power (23 per cent), city gas distribution-CGD entities (16 per cent), refinery (12 per cent) and petrochemicals (8 per cent).
In its outlook, CARE Ratings believes India’s energy demand is expected to rise as the economy expands and more people have access to power, cooking gas and personal transport. Currently, India is the third largest energy consumer after China and the US.
Its energy demand is expected to grow three-fold by 2040.
“Natural gas is emerging to be the gas of the future due to its clean burning properties and because its impact on the environment is not harmful. The Centre is also working towards transforming India into a gas-based economy and is actively working towards elevating its domestic production by introducing reforms such as the incentivise enhanced recovery methods for oil and gas in order to reduce the country’s import dependence as well,” the report noted.
In the current financial year, production of domestic natural gas is expected to be stable and reach the level of 34.2 billion cubic meters (BCM) in the coming months and touch 36 BCM by FY20. Continuing the uptrend, the demand for natural gas is tipped to climb to 54.8 BCM by the end of FY19 and 57.6 BCM by FY20.
The Centre and cash-rich PSUs in coal and oil sectors are jointly investing over Rs 500 billion to reopen fertiliser plants and set up gas pipelines which would make India self-sufficient in urea manufacturing.
Natural gas is used as a feedstock for urea manufacturing. There are 31 urea manufacturing plants out of which 28 run on natural gas and according to the second phase of ‘Gas Pooling Policy’, the remaining three plants will also be converted into gas-based plants.