With the dependence on imported gas expected to go up, the need for infrastructure such as trunk pipelines and liquefied natural gas terminals has also increased.
The domestic gas output in October fell 7.4 per cent at 4.026 billion cubic metres, as the production from offshore fields including Reliance Industries-operated KG-D6 block fell 9.8 per cent to 3.249 billion cubic metres.
Industry observers say, “In view of the unfavourable demand-supply situation, the need for adding infrastructure – both liquefied natural gas terminals as well as transmission networks – has become more prominent. Today, whatever gas is available is fully used.”
Of the current demand of about 180 mmscmd, the domestic gas output is about 122 mmscmd, imported gas is 46 mmscmd. This figure may undergo a change in the short-term if the domestic output does not increase, those tracking the sector say. The gas demand is projected at 210 mmscmd in the near term.
The cumulative gas output (April-October 2011) fell 8.3 per cent to 28.431 billion cubic metres, offshore production fell 10.9 per cent to 23.166 billion cubic metre against the same period last year, according to Petroleum & Natural Gas Ministry data.
There are currently two liquefied natural gas terminals – Shell (Hazira) and Petronet LNG (Dahej) – operational in the country. In the pipeline are three more terminals – in Kochi, Ratnagiri, and Ennore. The public sector gas transmission and marketing company, GAIL (India) has planned investments of about Rs 30,000 crore to increase its transportation capacity from the current 175 mmscmd to 300 mmscmd by 2013.
The country’s October crude oil output dropped 0.9 per cent to 3.218 million tonne versus the same month last fiscal. This drop was mainly because of decline in output from offshore fields including ONGC’s Mumbai High.
Around 80 per cent of the country’s hydrocarbon energy requirements are met through imports, as the growth in domestic oil and gas output is not proportionate with the growing consumption of petroleum products.
Domestic refiners processed 2.8 per cent less crude oil in October from a year ago at 13.203 million tonnes. The private sector refiner Essar turned 79.4 per cent less crude oil into petroleum products at its Vadinar refinery. The refinery was shut down for most of October.