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About Natural Gas


Natural Gas Scenario in India

  • Natural gas is the cleanest fossil fuels among the available fossil fuels. It is used as a feedstock in the manufacture of fertilizers, plastics and other commercially important organic chemicals as well as used as a fuel for electricity generation, heating purpose in industrial and commercial units. Natural gas is also used for cooking in domestic households and a transportation fuel for vehicles.
  • Gas supply sources in India:

    • Domestic Gas Sources:

      The domestic gas in the country is being supplied from the oil & gas fields located at western and southeastern areas viz. Hazira basin, Mumbai offshore & KG basin as well as North East Region (Assam & Tripura). It is being supplied and distributed in terms of the guidelines related to pricing and utilization policies issued by the Government from time to time. In FY 2018-19, total domestic gas production was about 90.05 MMSCMD.

    • Import of Liquefied Natural Gas (LNG):

      In order to meet the gas demand, Liquefied Natural Gas (LNG) is imported through Open General License (OGL) in the country and it is imported by the gas marketer under various Long Term, Medium Term and Spot contracts. The price and utilization of imported LNG is mutually decided by buyers and sellers. At present, country is having six (6) operational LNG regasification terminals operational with capacity of about 38.8 MMTPA (~ 140 MMSCMD).

The terminal-wise LNG import capacity details are as under-
Location Owner & Operator Regas capacity
Dahej (Gujarat) PLL 17.5
Hazira (Gujarat) SHELL 5
Kochi (Kerala) PLL 5
Kochi (Kerala) GAIL 1.3*
Mundra (Gujarat) GSPC LNG Ltd 5
Ennore (Tamilnadu) Indian Oil 5
Total Capacity (MMTPA) 38.8
Total Regas capacity (MMSCMD) (MMTPA) ~140

(*Name plate capacity is 5 MMTPA but in absence of the breakwater, the terminal can only operate at 1.3 MMTPA at present)

Gas Consumption in India:

  • In FY 2018-19, the total gas consumption in India was around 148.02 MMSCMD. The share of domestic gas and imported RLNG was about 48% & 52% respectively. Sector-wise gas consumption in FY 2018-19 is tabulated as under:
    Figures are in MMSCMD)
    Sl. No. Sector Domestic gas R- LNG Total
    1 City Gas Distribution (CGD) 14.36 10.91 25.27
    2 Fertilizer 17.18 23.85 41.03
    3 Power 25.11 8.07 33.18
    4 Others- Industries –Steel, Petrochemical, Refinery etc. 14.05 34.49 48.54
      Total 70.70 77.32 148.02

    ** Source- PPAC

  • In order to ensure the availability of natural gas at uniform delivered price to all grid connected Fertilizer (Urea) manufacturing units, the Government has implemented a policy of gas pooling mechanism-2015 for Urea sector. It has ensured uninterrupted supply of natural gas to Urea manufacturing plants leading to improve their efficiency.

Natural Gas Pipelines:

  • Gas Pipeline infrastructure is an economical and safe mode of transporting the natural gas by connecting gas sources to gas consuming markets. Gas pipeline grid determines the structure of the gas market and its development. Therefore, an interconnected National Gas Grid has been envisaged to ensure the adequate availability and equitable distribution of natural gas in all parts of the country.
  • At present, there are about 16800 km long Natural Gas pipeline network which is operational in the country. In order to make available natural gas across the country, it has been envisaged to develop additional about 14,300 km pipelines to complete the National Gas Grid and same are at various stages of development. This would ensure easy availability of natural gas across all regions and also potentially help to achieve uniform economic and social progress. A brief of major gas pipeline projects which are being implemented by Central Government PSUs are as under:
    • Jagdishpur – Haldia/Bokaro – Dhamra Pipeline Project (JHBDPL) & Barauni- Guwahati Pipeline project (BGPL)

      : GAIL is executing a 2655 km. long pipeline project. Phase-I of the project from Phulpur upto Dobhi (Gaya) with spur line to Varanasi, Patna, Gorakhpur & Barauni has been commissioned in 2019. Government, in September 2016, took a policy decision to provide 40% grant for this pipeline project which is also popularly known has as ‘Pradhan Mantri Urja Ganga (PMUG) for Eastern India’. Timely development of this project is supporting the revival of 3 Fertilizer Plants namely located at Gorakhpur, Barauni and Sindri and new Fertilizer Unit at Durgapur. Further, Pipeline from Barauni to Guwahati is also being implemented as an integral part JHBDPL project to connect North East Region (NER) with the National Gas Grid. The approx. length of the pipeline is 729 km. The entire project will cater to the energy demand of Eastern and North-Eastern Region covering six states, namely Uttar Pradesh, Bihar, Jharkhand, Odisha, West Bengal and Assam.

    • North East Region (NER) Gas Grid

      : A joint venture of five (05) oil and gas CPSEs i.e. GAIL, IOCL, OIL, ONGC and NRL named as “Indradhanush Gas Grid Ltd” (IGGL) has been entrusted to develop trunk pipeline connectivity in all North Eastern States i.e. Assam, Sikkim, Mizoram, Manipur, Aruncahal Pradesh, Tripura, Nagaland and Meghalaya in a phased manner. Prime objective of these pipelines would be to transport the domestic natural gas produced in the north east states and the same may first cater to the local requirements. It shall also connect the NER grid to the National Gas Grid.

    • Kochi-Koottanad- Bangalore-Mangalore (Ph-II) Pipeline Project (KKBMPL) :

      41 Km of Phase-I of pipeline has been commissioned and 887 Km of Phase-II is under progress in two sections. Construction work by GAIL of Kochi-Koottanad- Mangalore Section (444 Kms) is under progress and expected to be commissioned shortly. Work on other section is under progress.

    • Ennore-Thiruvallur-Bangalore-Nagapattinum– Madurai – Tuticorin Natural gas pipeline (ETBNMTPL):

      IOCL is laying Ennore-Thiruvallur-Bangalore-Nagapattinum– Madurai – Tuticorin Natural gas pipeline (ETBNMTPL), length- 1385 km. This pipeline will connect new Ennore LNG Terminal with various demand centres in the region.

City Gas Distribution (CGD) Networks:

  • Under the Petroleum and Natural Gas Regulatory Board (PNGRB) Act 2006, PNGRB grants the authorization to the entities for developing a City Gas Distribution (CGD) network (including PNG network) in a specified Geographical Area (GA) of the country. CGD sector has four distinct segments – Compressed Natural Gas (CNG) predominantly used as auto-fuel, and Piped Natural Gas (PNG) used in in domestic, commercial and Industrial segments.
  • Regulations pertaining to authorization/bidding of City Gas Distribution (CGD) networks were amended in 2018. The revised regulatory framework helped in attracting wider participation from public and private sector in CGD sector and leading to expand the coverage of CGD to 228 GAs spread over 406 districts with potential to cover about 53% of the country’s area and 70% of country’s population. It will make available environment friendly fuel i.e. CNG/PNG to public at large.
  • To promote the development of CGD network, the Government has accorded the priority in domestic gas allocation to PNG (Domestic) and CNG (Transport) segments. It has been decided to meet 100% gas requirement of CNG (T) and PNG(D) segments through supply of domestic gas which is cheaper than imported gas. At present, CGD sector is consuming approx. 14.36 Million Metric Standard Cubic Meter per Day (MMSCMD) of domestic Gas for CNG (Transport) and PNG (Domestic) sector. There is approx. 10.91 MMSCMD of imported Re-gasified Liquefied Natural Gas (RLNG) used by Commercial and Industrial segment of CGD sector.