The Gas Gameplan

India, the third-largest consumer of oil and gas in the world, is restructuring its energy portfolio to focus on cleaner and greener fuel.

- Ammar zaidi

The government is targeting to double use of natural gas, an eco-friendly fuel, to 240 million metric standard cubic metres per day (mmscmd) in five years by boosting domestic production as well as encouraging imports of liquified natural gas (LNG).

"Currently, India consumes around 120 mmscmd of gas, of which 60 per cent is consumed by power and fertiliser sectors. City gas distribution and other commercial and industrial uses account for the rest of gas consumption. With all our policy initiatives, planned infrastructure investments and global fall in gas prices, we expect the gas consumption to double in India in the next five years to 240 mmscmd," stresses Petroleum and Natural Gas Minister Dharmendra Pradhan.

The government is hopeful of attracting an investment of about $20 billion (over Rs 1,35,000 crore) in gas field development in the next five years, primarily in developing natural gas discoveries of State-owned Oil and Natural Gas Corporation (ONGC) and Reliance Industries (RIL)-BP joint venture off the east coast. "We are now expediting production of gas from domestic sources to the extent of 20 trillion cubic feet (tcf) from already discovered sources through policy, fiscal and regulatory mechanisms. These fields and the current auctions of discovered small fields are going to add to the domestic supplies in the next three to four years," notes Mr Pradhan.

ONGC is lining up $5.07 billion (nearly Rs 40,000 crore) to produce over 16 mmscmd of natural gas from a set of discoveries in its Krishna Godavari (KG) basin KG-DWN-98/2 block. RIL-BP has several discoveries in the adjacent KG-DWN-98/3 or KG-D6 block and NEC-25 off the Odisha coast. These companies will be making a major part of the Rs 1,35,000-crore investments over the next half decade primarily in deepwater fields to augment gas production.

Leg-up for gas