Challenges of Developing Natural Gas Infrastructure in India by Gail

8/4/2019 Challenges of Developing Natural Gas Infrastructure in India by Gail

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Presentation Flow

Demand- Supply ScenarioSupply Outlook

Demand Outlook

Emerging Scenario

Supply AugmentationLNG

Transnational Pipelines

Additional Sources

End-Use Outlook

Gas Sector Policy Developments

Gas Sector Infrastructure Present & Future

Goals to achieve the vision

Issues to be addressed

Policy, Regulatory & Fiscal Provisions Required


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Domestic Reserves : 1,072 BCM(37.8 TCF)

(Balance Recoverable Reserveas on April 1, 2005) R/P : 33.5 yrs Existing Producing Fields

Declining

Domestic Production 32 (1.1)

Domestic Availability 27(1.0)

LNG Imports* 6(0.2)

Total Availability 33(1.2)

INDIAN GAS SECTOR: SUPPLY OUTLOOK

CURRENT SUPPLIES (2005-06)

BCM (TCF)

Domestic Sources

LNG Import

CURRENT SUPPLIES 33.5 BCM (1.2 TCF)

HAZIRA (3.2BCM) YET TO STABILISE NOTINCLUDED UNDER CURRENT SUPPLIES

CURRENT SUPPLY SOURCES


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INDIAN GASSECTOR:DEMANDOUTLOOK

POWER FERTILISER PETROCHEM/

LPG

STEEL INDUSTRIES CITYGAS/ CNG

CONSUMPTION 33 BCM (1.2 TCF)

DEMAND PROJECTIONSCURRENT CONSUMPTION

(2005-06)

HYDROCARBON VISION 2025

40%

29%

15% 4%

3%

9%

114

143

80

100

120

140

160

200 2012 2017 2022

8 4

2025

Demand estimated to grow at 4.2% CAGR

DEMAND BY 2025 143 BCM (5 TCF)

(4 TCF)

(5 TCF)


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SUPPLY-DEMANDOUTLOOK:EMERGING SCENARIO

SUPPLY BCM TCF

SUB TOTAL FROM CURRENT SOURCES (2012) 26 0.9

TOTAL NEW DISCOVERIES 36 1.3

SUB TOTAL NEW LNG IMPORTS 24 0.8

TOTAL (PROJECTED CURRENT SOURCES + NEW

DICOVERIES + NEW LNG)86 3.0

DEMAND (BY 2012) 114 4.0

DEMAND (BY 2025) 143 5.0

PROJECTED SHORTFALL (2012) 28 1.0

PROJECTED SHORTFALL (2025) 57 2.0


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SUPPLYAUGMENTATION:LNG

LNG TO BECOME A SIGNIFICANT SUPPLY SOURCE

LNG share in Indias total GasConsumption to grow from 11% in 200 -05to 38. % by 200 -10

12.5 MMTPA of LNG already tied up

10 MMTPA of LNG to be tied up


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SUPPLYAUGMENTATION:TRANSNATIONAL PIPELINES

India strategically located for gas imports through trans-national pipelines

Projected shortfall of28 BCM in 2012 to double in 2025

SUPPLY BCM TCF

NEW PIPELINE IMPORTS

- Iran-Pakistan-India

- Turkmenistan-Afghanistan-Pakistan-India

- Myanmar-India

32.8

21

0

1.2

0.7

0.3

TOTAL PIPELINE SUPPLIES 52 1.8

TRANSNATIONAL PIPELINES TO PROVIDE COSTEFFECTIVE SUPPLY SECURITY


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SUPPLYOUTLOOK:ADDITIONALSOURCES

India has the 4th largest coal reserves in the world (247Billion Tons)

Ranks 3rd in coal production (355 Million TPA)

Total Recoverable reserves of only about 20%

Exploitation of current unrecoverable reserves is a majorchallenge

Coal Bed Methane (CBM), Underground Coal Gasification(UCG) and Surface Coal Gasification hold significantpotential for gas


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COAL BED

METHANE (CBM)

INSITU COAL /

LIGNITE

GASIFICATION

SURFACE COAL

GASIFICATION

16 blocks awarded under

2 CBM rounds

Estimated reserves

~ 1400 2600 BCM (50

92 TCF)

Equivalent to 40 - 75 yrs

of current levels of

natural gas consumption

First CBM Gas Expected

by 2007

Total potential 15,820

BCM (565 TCF), as per

projections of UK based

UCG Parnership

Equivalent to 450 - 500

yrs of current levels ofnatural gas consumption

Focus Areas - 5 States

(Gujarat, Rajasthan, TN,

AP, W Bengal)

Total Coal Reserves

247 BT

Focus Areas 2

States (Orissa, W

Bengal)

Syn gas potentialidentified

2.3 BCM (0.1 TCF)

SUPPLYOUTLOOK:ADDITIONALSOURCES


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INDIAN GASSECTOR: ENDUSEOUTLOOK

Gas Based Power

Gas Based Fertilizer

LPG & Petrochemicals

CNG, PNG

City Gas- Industrial, Domestic, Commercial


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SECTORAL DRIVERS FOR CURRENT GAS DEMANDIN INDIA

12%12%

43%43%31%31%

58%58%

Non gas based units

10894 MW 12 MMTPA

1 MMTPA 2.5 MMTPA

POWER FERTILISER

LPG + LIQUID HYDROCARBONPETROCHEMICALS


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Urban Pollution - A major issue Successful Experience in Delhi,

Mumbai Currently in 10 cities Plans to introduce CNG and

city gas in28 cities

Segment Total

Vehicles 25 836

Domestic 413115

Commercial 2664

SmallIndustries

55

Gas Used

(BCM)

1.86

CITY, CNG GAS SECTORS EMERGINGAS AN IMPORTANT END-USE SEGMENT

CNG, PNG, CITY GASDISTRIBUTION


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GASSECTORI FRASTRUCTURE:CURRENTOUTLOOK

LNG Terminals 2 Terminals (Dahej, Hazira), 7.5 MMTPA capacity

Transmission Network 6,300 KmsGAIL 5,300 Kms

GSPL 525

KmsAssam Gas 300 KmsOIL 175 Kms

Distribution Network 6,000 Kms (Delhi, Mumbai, Ankaleshwar,Bharuch, Surat, Baroda, Agartala)

CNG Stations 278 (Delhi, Mumbai, Surat, Vijayawada,Ankaleshwar, Bharuch,Baroda)


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GASSECTOR POLICY:SIGNIFICANTDEVELOPMENTS

100% FDI in E&P under NELP

100% FDI in natural gas pipelines

LNG imports, Gas Marketing under Open General

Licence

Petroleum and Natural Gas Regulatory Board Billunder Finalisation (Unbundling, Third Party Access)

Gas Pipeline Policy under finalisation Progressive Decontrol of prices

Policy Thrust to ensure Energy Security


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TUTICORIN

MANGLORE

HASANBANGLORE

CHENNAI

TUTICORIN

KOLKATA

RAJAMUNDRY

DABHOL

MUMBAI PUNE

BHARUCH

VIJAIPUR

HYDERABAD

BHUBANESHWAR

KRISHNAPATNAM

JAGDISHPUR

KANJIRKKOD

KOCHI

A 1 BLOCK,MYANMAR

KOTA

MATHANIA

PHOOLPUR

BHATINDA

NELLORE

TIRUCHCHIRAPALLI

KOLHAPUR

GAYA

BOKARO

COIMBTORE

JAMNAGAR

BAREILLY

AURAIYA

DELHI

BANGLADESH

NEPAL BHUTAN

AIZAWLAGARTALA

SHILLONG

DISPUR

GANGTOK

GASSECTORINFRASTRUCTURE:CURRENTAND FUTURE A

COMPOSITE PICTURE

DAHEJ I & II10 mmtpa*

HAZIRA2.5 mmtpa

DABHOL5

mmtpa

COCHIN5 mmtpa

BARODA

SURATANKLESHWAR

KANPUR

LUCKNOW

LNGExisting (7.5 MMTPA)

Upcoming (22.5 MMTPA)

Transmission PipelinesExisting (6,300 Kms)

Planned (8,400 Kms, US$ 4.2 Billion)

City Gas/ CNGExisting (10 cities)

Planned (28 cities)

VIJAYAWADA

PATNA

AHMEDABAD

SURENDARNAGAR

RAJKOT

FARIDABAD

GWALIOR

INDORE

UJJAIN

SOLAPUR

AGRAALLAHABAD

VARANASI

MATHURA

JHANSI

DAMRA

Gas By Sea Receipt (Likely Location)


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Points ofConcern

True implementation of unbundled system

Sourcing & customer tie-ups should be under the domain of

Gas Trading activities

Minimum Excess capacity should be maintained

One uniform model of transportation tariff to be adopted.


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Requirement of Provisions

Direct taxes

Infrastructure status to cross country pipelines

Tax Holiday Benefits for Gas pipelines

Indirect taxes

Zero customs duty on supplies required for Natural GasPipelines

Zero custom duty on LNG/Natural Gas

Declared Goods status to Natural Gas under Central Sales

tax Act, 1956

A. Financial


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Cont..

Development of Indigenous Steel Mills for API 5L grade steelproduction

Encourage Indigenous Steel Mills to produce API grade steel

Encourage new players in line pipe manufacturing and pipelaying

B. Technology

C. Statutory Single Window Clearance at State Level for all statutory

clearances Single Window Clearance at Center for Environmental Clearance

and ROU Acquisition

Common Corridor for Transmission Pipelines


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Thank You

Challenges of Developing Natural Gas Infrastructure in India by Gail

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