India to Become a Net Importer of Natural Gas in Two Years

From ZEEBIz.com

With domestic output stagnating, India will become a net importer of natural gas in next two years with expensive LNG meeting rising energy demand of the growing economy.

Liquefied natural gas (natural gas cooled to its liquid form for ease of transporting in ships) imports at 39.32 million standard cubic meters per per day constituted 25.5 percent of the total consumption of the fuel in the country in 2011-12.

This share, according to Petroleum Ministry’s latest estimates, will rise to 41 percent in current fiscal and to 50 percent in the next.

In 2012-13, domestic natural gas production is estimated to be around 104 mmscmd, down from 114.90 mmscmd in the previous fiscal. In current year, LNG imports will jump to 73 mmscmd and are projected to further rise to 105 mmscmd in 2013-14, equalling the domestic gas production of that year.

In 2014-15, imports at 115 mmscmd will surpass domestic production of 113 mmscmd, the ministry estimates said.

For a nation whose current account deficit is already battered by 79 percent reliance on imports for meeting oil needs, higher share of LNG in the energy based will not be a good news.

Industry officials said the domestic output has stagnated in absence of remunerative prices.

UK’s BP Plc, which partners Reliance Industries in the flagging KG-D6 gas block and other gas discovery areas, recently wrote to Oil Minister M Veerappa Moily saying around 5 trillion cubic feet of discoveries in KG-D6 and NEC-25 block in Mahanadi basin can be developed on price clarity.

The reserves RIL-BP has are more than the remaining resource in state-owned Oil and Natural Gas Corp’s fields.

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