India's plans of energy security with more natural gas in the energy mix will get a boost in the near future, as new gas finds will ease global demand and supply dynamics by 2030, say experts.
An unprecedented surge in new liquefied natural gas (LNG) projects coming online from 2025 is set to add more than 250 billion cubic metres (BCM) per year of new capacity by 2030, equivalent to around 45% of today's total global LNG supply (about 550-600 BCM a year), predicts International Energy Agency (IEA) Energy Outlook, 2023. Announced timeliness suggests a particularly large increase between 2025 and 2027 and more than half of the new projects are coming up in the United States and Qatar, says the report, which predicts global natural gas demand and prices are likely to fall going forward.
"The strong increase in LNG production capacity eases prices and gas supply concerns, but comes to market at a time when global gas demand growth has slowed considerably since its "golden age" of the 2010s," says IEA.
The prediction of easy availability of natural gas in liquified form is good news for India, which is increasing the share of natural gas in its energy basket to 15% by 2030 from the current 6.2%, say experts. India was the world's sixth-largest LNG importer in 2022, with about 28.4 billion cubic meters (BCM), according to Statista data. About 42% of its imports are from Qatar, followed by the United States (16%) and UAE (13%), where most of the new major gas projects are coming up.
Qatar, the world's top exporter, is planning to expand its liquefaction capacity to 126 million tonnes per year by 2027 from 77 million. Petronet, promoted by IOC, BPCL and GAIL (India), has a 7.5-million metric ton per year long-term LNG import deal with Qatar. India's leading public sector oil marketing company Indian Oil Corporation (IOC) signed a $7-9 billion deal last year to import LNG from the UAE's ADNOC Gas for 14 years beginning 2026. IOC also had signed up with TotalEnergies of France for the import of 0.8 million tonnes a year of LNG for 10 years starting in 2026. These were the first long-term contracting of LNG by India, in the wake of the changing dynamics in the global LNG market, say sources.
India's total consumption of natural gas was about 60 BCM in 2022-23 and 64.2 BCM in 2021-22. Domestic production was only around 34.450 BCM in 2022-23 and 34.024 BCM in 2021-22, according to Petroleum Planning & Analysis Cell (PPAC) data. India's import dependency based on consumption of natural gas has decreased from 48.2% in 2021-22 to 46.3% in 2022-23 (April to October), claims government.
The government is trying to increase domestic production of natural gas and adopted strategies for the promotion of biofuels, compressed Biogas, National Gas Grid for pipeline infrastructure, City Gas distribution Networks and LNG regasification terminals. As part of the plans to usher in natural gas as a transition fuel for the future, India is spending over ₹3 lakh crore by 2026 to set up an extensive natural gas infrastructure. LNG terminals at ports are increasing capacity from 42 MTPA at six terminals to over 80 MTPA at 10 terminals by 2024. Other expansions include 34,600 kilometres of pipelines by 2024 from nearly 22,000 kilometres in 2022, Piped Natural Gas (PNG) connections to 60 million by 2030 from 9.3 million in 2022, Compressed Natural gas (CNG) stations to 10,000 by 2030 from 4500 in 2022 etc.