India keen to develop a South Asian Gas Grid connecting important neighbours: Pradhan
02 November, New Delhi
Minister of Petroleum and Natural Gas Dharmendra Pradhan on Thursday said that India, as a regional economic hub, is also keen to develop a South Asian gas grid connecting important neighbours such as Myanmar, Bangladesh, Nepal, Bhutan, Sri Lanka, etc.
Indian companies are also trying out innovative models like small scale LNG to cater to countries like Sri Lanka and Bangladesh. At the Plenary Session of 7th Asian Ministerial Energy Roundtable in Bangkok, Pradhan said that Indian companies have signed long-term contracts for around 22 MMTPA from different supply sources across world such as Qatar, Australia, Russia, USA etc.
“They have signed contracts linked to different indices such as Henry Hub, crude oil index etc. In order to reduce the delivered cost of LNG to Indian market, Indian importers have adopted innovative approaches like time swap of volumes, destination swaps and contract on Free on Board basis,” he said.
In his speech, titled “Natural Gas: Overcoming Market and Policy Hurdles to the Golden Age of Gas”, Pradhan said that India’s gas uptake is less 6.5 per cent of primary energy basket against a global average of more than 24 per cent. Government of India has envisioned to increase the share of natural gas in India’s energy mix to 15 per cent by 2030.
India is currently the world’s fourth-largest importer of LNG, behind Japan, South Korea and China. Last year, India imported approximately 19 Million metric tons of LNG, an increase of around 15 per cent over the previous year.
He said, “India has taken several far-reaching measures in India to increase domestic production of gas and also to promote the usage of gas. We have introduced pricing and marketing freedom for gas producers in future exploration bidding rounds. India is developing a Natural Gas Trading Exchange where both imported LNG and domestically produced gas can be traded. We are looking to increase the consumption of natural gas through policy measures in each micro segment of consumption.”
“The global natural gas market is undergoing a major transformation driven by new supplies coming from the United States, Australia and Qatar are also ramping up their production while new suppliers such as Mozambique, Tanzania, Egypt, Israel, Canada and Cyprus are expected to enter the LNG market in the coming years. It is expected that more than 100 MMTPA of new liquefaction capacity is expected to come on-stream in the period 2017-2020, mainly from Australia and the US,” said Pradhan.