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India

Table of Contents
  1. 1. Introduction
  2. 2. Key statistics
    1. 2.1. Unconventional gas
  3. 3. Gas demand
    1. 3.1. Total Primary Energy Consumption by Fuel
    2. 3.2. Gas demand by sector
  4. 4. Gas supply
    1. 4.1. Gas reserves
    2. 4.2. Exploration & Production
    3. 4.3. Imports & Exports
  5. 5. Gas Infrastructure
    1. 5.1. Gas Grid
    2. 5.2. LNG
    3. 5.3. Storage
  6. 6. Gas market regulation
    1. 6.1. Upstream
    2. 6.2. Networks
    3. 6.3. Downstream

1. Introduction

India is situated in South Asia and is bordered to the West by Pakistan, to the north-east by China, Bhutan and Nepal; to the east by Bangladesh and Burma; to the south by the Indian Ocean; and to the south-west by the Arabian Sea and to the south-east by the Bay of Bengal. India has a total surface of 3,287,263 square kilometers (1,269,219 square miles) and is inhabited by approximately 1.2 billion people (2011 census). It is the seventh largest country in the world by geographical area and the second most populous (and the first most populous democracy). It has a yearly GPD (PPP) of $4.46 trillion (2011 estimate) and a GDP (PPP) per capita of $3,963. In nominal GDP, these figures amount to USD 1.68 trillion and $1,388. The Economy of India is in 2012 the world’s third-largest by purchasing power parity and the tenth-largest by nominal GDP. [1]  

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2. Key statistics

Basic gas facts - India
Basic Gas Facts 2006 2007 2008 2009 2010e
Gas reserves (bcm) .. .. .. 1085 1060
Gas production (mcm) 30791 31479 31773 46459 51198
Gas consumption (mcm) 40190 42863 42715 58708 63757
Gas imports (mcm) 9587 11567 11164 12515 12559
-imports pipeline (mcm)          
-imports LNG (mcm) 9587 11567 11164 12515 12559
Import dependency (%)* 23.85% 26.99% 26.14% 21.32% 19.70%
Gas exports (mcm)          
Natural gas supply per capita (toe) .. .. .. .. ..
Technically recoverable shale gas resources (bcm) .. .. .. 1784.16 ..
Coal Bed Methane reserves (bcm)** .. .. .. .. ..
c = confidential; - = nill; ..= not available
* Imports dependency of natural gas = (imports - exports) / consumption
**Proven & Probable (2P); U.S. Environmental Protection Agency, Coalbed Methane Outreach Program
Sources: Natural Gas Information © OECD/IEA, 2011, EIA Analysis & Projections, GMI/EPA Coal Mine Methane Country Profiles

[1], [2], [3]

Basic energy facts - India
Basic Energy Facts 2006 2007 2008 2009 2010e
Total Energy Consumption (mtoe) 381.42 414.55 444.64 479.97 524.23
CO2 emissions, energy-related (Mt) 1282.68 1368.38 1463.30 1591.13 ..
CO2 intensity, energy-related (tCO2/toe) .. .. .. .. ..
Energy consumption per capita (toe/cap) 0.40 0.42 0.44 0.48 ..
CO2 per capita, energy-related (tCO2/cap) 1.16 1.22 1.28 1.38 ..
c = confidential; - = nill; ..= not available
Sources: BP Statistical Review June 2011 & EIA International Energy Statistics

[1], [2], [4]

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2.1. Unconventional gas

Shale Gas  

India indicated that it has four priority basins for shale gas: Cambay, Krishna Godavari, Cauvery and the Damodar Valley sub-basins such as Raniganj, Jharia and Bokaro. There are others, but these have not been fully investigated yet. As can be seen in the table ‘Basic Gas Facts’, India is estimated to have 1,784 bcm of technically recoverable shale gas. This number could increase with collection of additional reservoir information. The country has yet to hold a licensing round for its shale gas blocks.

Shale basins in India are geologically highly complex. The prospective area for shale gas in these basins is restricted to a series of isolated basin depressions (sub-basins). While the shales in these basins are thick, considerable uncertainty exists as to whether (and what interval) of the shale is sufficiently mature for gas generation. In 2010-2011, ONGC drilled and completed India’s first shale gas well, northwest of Calcutta in West Bengal. The drill was moderately successful. For more specific information on each specific basin, see reference. [1]

Coal Bed Methane

Estimates of India’s CBM potential vary. One source estimates up to 2 trillion cubic meters (tcm) of CBM in 56 coal basins covering 64,000 square kilometres. The Directorate General of Hydrocarbons estimates that deposits in 44 major coal and lignite fields in 12 states of India, covering an area of 35,330 km2, contain 3.4 tcm of CBM.

In May 2001, the Indian government for the first time offered blocks for exploration and production of CBM through an international bidding process. The government launched a second round of bidding on nine CBM blocks in May 2003. The Directorate General of Hydrocarbons offered an additional 10 CBM blocks during a third round of open international competitive bidding that closed in June 2006. Contracts for this third round of bidding were signed in November 2006. These 26 prospective CBM blocks in the first three rounds of bidding cover an area of around 13,590 km2 and are estimated to contain 1.45 tcm of CBM resources. Expected total production from these blocks is estimated at 39.7 mcm per day at their peak production level. Over the last few years, more than 130 exploratory (test) and 80 pilot wells have been drilled in the awarded blocks. Commercial production began in the Raniganj (South) CBM block in July 2007 and commercial production in the Sohagpur (East) and Sohagpur (West) CBM blocks is expected to commence in the near future. Current gas production from these three blocks is about 0.14 mcm per day and by 2013-2014, production is expected to increase to 7.4 mcm per day. The fourth round of bidding on 10 new CBM blocks took place in the fall of 2009. The blocks cover an area of approximately 5000 km2 and are spread over seven states. 26 bids were received for eight of the blocks on offer. Essar Oil Limited, Arrow Energy, and Great Eastern Energy Corporation Ltd. were the successful bidders. [2]  

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3. Gas demand

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3.1. Total Primary Energy Consumption by Fuel

In 2010, India’s Total Primary Energy Consumption amounted to 524.2 mtoe, a 9% increase compared to 2009. In 2010, oil accounted for 155.5 mtoe, while coal and gas accounted for 277.6 mtoe and 55.7 mtoe respectively. Hydro and Renewables accounted for 25.2 mtoe and 5.0 mtoe respectively. [1]

*other: renewables, nuclear, hydro

[1]

*other: renewables, nuclear, hydro

[1]

Natural gas demand is expected to grow considerably, largely driven by demand in the power sector, which, together with the fertilizer sector, accounts for nearly three-quarters of natural gas consumption in India. Despite the steady increase in India’s natural gas production, demand has outstripped supply and the country has been a net importer of natural gas since 2004 (see also section 4.2 and 4.3).[2]

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3.2. Gas demand by sector

From current sources used it is only known that 27,864 mcm was used for transformation (electricity generation) in 2009.

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4. Gas supply

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4.1. Gas reserves

In 2010, India holds 1,060 bcm of natural gas reserves, representing 0.56% of the world total reserves. [1] The reserves-to-production (R/P) ratio* for India was 28.5 years at the end of 2010, which is significantly higher than, for example, the EU’s average R/P ratio of 14 years.[2]

*Reserves-to-production (R/P) ratio – If the reserves remaining at the end of any year are divided by the production in that year, the result is the length of time that those remaining reserves would last if production were to continue at that rate.  

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4.2. Exploration & Production

In 2010, India produced 51,198 mcm of natural gas, 4,739 mcm more than in the previous year. India has increased its production of natural gas by two thirds since 2006, when it produced 30,791 mcm. [1] Until 2008, the majority of India's natural gas production came from the Mumbai High complex in the northwest part of the country. Recent discoveries in the Bay of Bengal have shifted the center of gravity of Indian natural gas production. State-owned companies play a predominant role in India's gas sector. ONGC accounted for about half of India's natural gas production in 2009-2010. Reliance Industries will also have a greater role in the natural gas sector in the coming years, as a result of a large natural gas find in 2002 in the KG basin. In June 2011, the Indian government approved a $7.2 billion joint venture agreement between Reliance and BP that will focus on expanding offshore development. In addition to these new offshore finds, India plans to expand the development of unconventional gas resources. The country already produces some coalbed methane and seeks to expand these volumes soon (also see section 2.1). [2]  

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4.3. Imports & Exports

In 2010, India imported 12,559 mcm of natural gas (indicating an upward trend in absolute terms), representing 19.7% of its domestic consumption. All of India’s gas imports are being accomplished via LNG, so far there are no pipeline imports. The proportion of imported gas in India’s consumption decreased 7.29 percent point from 26.99% in 2007 to 19.70% in 2010. Over the years 2006-2010, India has imported LNG from at least twelve different countries. The biggest source for gas imports into India has been Qatar: in 2010 about 85% of all the LNG imported into India came from Qatar. Other important sources of import for India were, amongst others, Trinidad & Tobago, Equatorial Guinea, Egypt and Nigeria. [1]

Imports by country - India
By country of origin (in mcm) 2006 2007 2008 2009 2010e %Total Imports 2010
Australia 91   160 1108    
Norway ..   80      
Algeria 91 545 530 158    
Egypt 624 91 240 330 86 0.68%
Equatorial Guinea ..   415 250 172 1.37%
Indonesia ..     80    
Malaysia 91 91 80 254    
Nigeria 91 817 380 317 320 2.55%
Oman 272 272 410 345    
Qatar 8236 9433 8336 8155 10670 84.96%
Trinidad and Tobago .. 238 230 680 660 5.26%
United Arab Emirates 91 80 130 163    
Other ..   173 675 651 5.18%
Total 9587 11567 11164 12515 12559 100%
%Total Consumption 23.85% 26.99% 26.14% 21.32% 19.70%  
c = confidential; - = nill; ..= not available
Source: Natural Gas Information © OECD/IEA, 2011

[1]

Imports by transport type - India
By transport type (in mcm) 2006 2007 2008 2009 2010e %Total 2010
Pipeline imports ..          
LNG imports 9587 11567 11164 12515 12559 100%
Total 9587 11567 11164 12515 12559  
%Total Consumption 23.85% 26.99% 26.14% 21.32% 19.7  
c = confidential; - = nill; ..= not available
Source: Natural Gas Information © OECD/IEA, 2011

[1]

India's natural gas import demand is expected to increase in the coming years. To help meet this growing demand, a number of import schemes including both LNG and pipeline projects, have either been implemented or considered. These will be discussed in sections 5.1 and 5.2. [2]

 

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5. Gas Infrastructure

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5.1. Gas Grid

Pipelines

The Gas Authority India Limited, or GAIL, owns the biggest part of the transport system. The main transport system is represented by the inland cross country pipelines Hazira-Vijaipur-Jagdishpur pipeline, Dahej-Vijaipur pipeline and Dahej-Uran pipeline. Operators GSPC and AGCL own several regional pipelines. In 2007, a pipeline from KG basin on the East Coast to the Western Coast was being put down by Reliance Industries Ltd.

Although the transmission sector was opened to foreign investment in 2006, 80 percent of natural gas consumed in India was transported through GAIL's 6,600 kilometer long trunk pipeline network. The company expects to double the size of this network by 2014. Reliance Industries is also investing heavily in the transmission sector to move its KG-basin gas to market.

Gas Infrastructure Projects

Iran-Pakistan-India Pipeline

The Iran-Pakistan-India (IPI) Pipeline has been under discussion since 1994. The plan calls for a 2,736 km long, 153 mcm per day capacity pipeline to run from the South Pars fields in Iran to the Indian state of Gujarat. A variety of economic, political, and security issues have delayed a project agreement. Due to the uncertainties involving this pipeline, the Indian government's 11th Five Year Plan does not project any gas supply from this route or the following two discussed pipelines.

Turkmenistan-Afghanistan-Pakistan-India Pipeline

India has worked to join the Turkmenistan-Afghanistan-Pakistan Pipeline (TAP or Trans-Afghan Pipeline). With the inclusion of India, the project consists of a planned 1,690 km pipeline originating in Turkmenistan's Dauletabad natural gas fields and transporting the fuel to markets in Afghanistan, Pakistan, and India. In 2010, India signed a framework agreement for the pipeline, which is envisioned to have a capacity of 90.6 mcm per day, but work has not yet begun on the project.

Imports from Myanmar

The governments of India and Myanmar signed a natural gas supply deal in 2006, but disagreement arose over whether the pipeline should go through Bangladesh. In March 2009, Myanmar signed a natural gas supply deal with China sourced from a field invested in by GAIL and ONGC, putting any India-Myanmar pipeline deal in question. [1]  

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5.2. LNG

According to GIIGNL in 2010 there were three operational LNG regasification terminals in India with a combined storage capacity of about 1.4 mcm of LNG and an output capacity of 22.92 bcm of gas per year. One other terminal is under construction (Kochi) and another one has been proposed (Mundra). [1]

LNG - India
Site Storage   Regasification   Owner Operator TPA Start-up Source Status
  #Tanks Cap.* #Vaporizers Cap.**            
Dahej 4 592 19 12.5 Petronet LNG Petronet LNG Yes 2004 (expansion 2009) Qatar, Algeria, Egypt, Australia, Oman, Trinidad & Tobago, Nigeria E
Hazira 2 320 5 3.4 Hazira LNG Private Ltd. (74% Shell, 26% Total) Hazira LNG Private Ltd. No 2005 Nigeria, Egypt, Algeria, Oman, Qatar, Belgium, Australia, T&T, Abu Dhabi, Norway, Equatorial Guinea E
Dabhol 3 480 .. 7.02 .. Ratnagiri Gas and Power Privated Ltd. .. 2011 .. E
Kochi .. .. .. 7.02 Petronet LNG Petronet LNG .. 2012 .. U
Mundra .. .. .. 9.13 .. .. .. .. .. P
Total 9 1392 24 39.06            
c = confidential; - = nill; ..= not available
E = existing; U = under construction; P = proposed
* capacity in m3 x1,000 in LNG
**nominal capacity in bcm/year of gas
Source: GIIGNL 2010

[1]

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5.3. Storage

No complete and/or consistent data is yet available on this topic. Please help us and the gas community in completing this information and suggest a reference!

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6. Gas market regulation

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6.1. Upstream

In 1999 the New Exploration Licensing Policy (NELP) came into effect in India offering oil and gas fields through competitive bidding routes. In 2007, the most important gas producers in India were two state-owned companies: Oil and Natural Gas Corporation Ltd (ONGC) and Oil India Ltd (OIL). ONGC operated mostly in the western part of the country while OIL was operating in the states of Assam and Rajasthan. Apart from the state-owned producers, there are privately-owned producers undertakings for the fields of Tapti, Panna-Mukta and Ravva

The prices of gas produced by ONGC and OIL are regulated by India’s Ministry of Petroleum & Natural Gas, while respective production sharing contracts (PSCs) between the government and the operators are governing the prices for gas produced by joint ventures and NELP. [1]  

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6.2. Networks

The activities of both distribution and transmission are open to private sector investments. But the Gas Authority of India Ltd. (GAIL) holds an effective monopoly on natural gas transmission and distribution activities.

The government is in charge of approving tariffs. Nevertheless, after the establishment of the Petroleum and Natural Gas Regulatory Board (PNGRB) in October 2007, common or contract carrier pipelines and city or local gas distribution networks started to be regulated by PNGRB. [1]

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6.3. Downstream

The gas produced by ONGC has been marketed by Gail at regulated prices set by the government. Private sector actors and joint ventures have been marketing their gas at market prices. [1]

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