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LNG: India Gas Consumption Targets Reply Heavily on LNG Imports: IEEFA

LNG

India might have to rely heavily on LNG imports and undertake massive infrastructure development to achieve plans to add 500mcm/d of gas consumption by 2030, according to IEEFA.

  • LNG import capacity required could fall short by 240mcm/d even after the proposed infrastructure expansion from the current capacity of around 171mcm/d. 
  • Gas consumption price sensitivity and competition from cleaner energy alternatives could hamper infrastructure expansion and trigger stranded asset risk.
  • India aims to increase the share of natural gas in its energy mix requiring a significant increase of over 150% within a short period from 185mcm/d in the fiscal year 2023-24.
  • India’s domestic natural gas production in FY2023-24 was around 99.5mcm/d while LNG imports were 85.6mcm/d.
  • Increased domestic production of 15cmc/d is expected to come on stream in 2024-25 but could face commissioning delays amid technical and technological difficulties.
  • Natural gas production will likely peak at 113mcm/d in 2026 and decline to around 90mcm/d by 2030. 
  • Competition from cleaner, cost-effective options could limit the role of gas in the medium to long term in India’s energy mix.

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