India’s Petronet is opening up a new LNG supply business that it hopes could boost demand by 8 million-9million t/yr in the next few years, equivalent to around a third of the country's import levels.
To set up LNG retail outlets, Petronet is partnering with state-controlled oil marketing companies and city gas firms. The company will lease equipment and supply the fuel while leaving its partners to operate the outlets.
The company has tied up with state-controlled Gujarat Gas to open five such outlets on the Delhi-Mumbai highway in the next few months. Indraprastha Gas, a joint venture between state-run gas distributor Gail and refiner BPCL, is separately setting up three more outlets on the same route.
To create business for the retail outlets, Petronet is testing the use of LNG-fuelled trucks and buses. The 8 million-9 million t/yr target appears ambitious, given demand for LNG as a road fuel is currently almost zero in India.
After the government this month waived a key regulatory requirement to set up LNG filling stations, progress on the retail plans has accelerated.
From 2.37 billion m³ a year earlier, India's LNG imports rose by 0.5 percent to 2.38 billion m³ of pipeline gas equivalent (1.83 million t of LNG) in May. The country will need an additional 40 million t/yr of LNG by 2030 to meet demand, even after accounting for a surge in domestic output from deepwater areas off the east coast.
