LPG for 50% households by 06: Naik

In the next two years, 50 per cent of the households will be covered by LPG gas connections, said Ram Naik, the union minister of petroleum and natural gas. He laid the foundation stone for the Rs 333-crore LPG Cavern Storage Project here yesterday.

The project is the first of its kind in the country. South Asia LPG Company, a 50:50 joint venture set up by Hindustan Petroleum Corporation Limited and France-based Total Group, has taken up the 60,000-tonne capacity project.

At present, 38.5 per cent of the households have LPG connections, and the government's emphasis in now on taking LPG to rural areas, the minister said.

The number of LPG connections had doubled from 3.5 crore in 1999 to 7.3 crore at present. The LPG consumption was 8.5 million tonne per annum. The domestic production of LPG is about six million tonne, and the remaining is imported.

The cavern project, which would take care of supply distribution, is the first step towards building a buffer stock of LPG. The underground storage is safe, cheaper and requires less maintenance as compared to surface storage, Naik observed.

The LPG project will enable import of LPG in larger ships, reduce freight costs and enable the country take advantage of seasonal fluctuations in LPG prices. The government also plans to build strategic storage of five million tonne crude oil at Visakhapatnam and Mangalore.