India in talks to buy 20 mn tonnes of LNG: Moily
Quotes

India in talks to buy 20 mn tonnes of LNG: Moily

Last Updated: Tuesday, June 11, 2013, 18:00
 
 Comment 0
 
India in talks to buy 20 mn tonnes of LNG: Moily
New Delhi: Energy-hungry India is in talks to buy as much as 20 million tonnes a year of liquefied natural gas or LNG but price of over USD 10 remains a challenge, Oil Minister M Veerappa Moily said Tuesday.

"India has now become fifth largest importer of LNG after Japan, South Korea, UK and Spain and accounts for 5.5 percent of the total trade," he said addressing third IEF NOC-IOC Forum.

With LNG demand expected to grow at 5-6 percent per year till 2020 and 2-3 percent thereafter, India along with other Asian counterparts is driving this growth, he said.

"A lot of capacities are being created in India and huge numbers of supply deals have been there. LNG re-gasification capacity expected to be more than 50 million tonnes per annum by 2016-17 with a supply of 198 million standard cubic meters per day," he said.

The nation currently has three operational LNG import facilities - 10 million tonne terminal at Dahej and 3.6 million tonne plant at Hazira in Gujarat and 5 million tonne terminal at Dabhol in Maharashtra. A 5 million tonne capacity terminal is to be commissioned in Kochi in Kerala this year. LNG terminals are being planned on the east coast as well.

"India already has secured supply deal of around 14 million tonnes per annum (of LNG) and around 20 million tonnes deals are in the pipeline. But challenge before us is that landed cost is expected to remain high in the lower range of USD 10-12 per million British thermal unit, not in the range of USD 4-5 which customers are used to," he said.

"Making this LNG a cheaper comparable fuel option is a great task," he added.

Moily said pricing of LNG (natural gas super-cooled to turn it into liquid for ease of transportation in ships) is fast turning an issue.

"Importers now desire to move away from oil-linked gas prices to henry hub gas pricing on account of high price band in which oil is hovering around," he said.

Stating that the country depends on imports to meet 73 percent of its oil needs, the Minister said he wants to reduce imports by 50 percent by 2020, 75 percent by 2025 and eventually achieve self-sufficiency and energy independence by 2030.

Part of this will be done by finding more oil and gas.

Despite very low per capita consumption of energy, which is about one-third of global average, India is the fourth- largest consumer of energy in the world and expected to become third largest consumer of energy by 2030, he said.

India's energy consumption will grow at around 7.2 percent during 2007-2030 in comparison to world average of 1.5 percent, he said.

As per IEA projections, India will be needing additional 271 million tonnes of oil and 97 million tonnes of oil equivalent gas per annum by 2030.

"To meet this huge gap, the country's import dependency is expected to rise to around 90 percent for oil and over 60 percent for natural gas and coal," Moily said.

India is still driven by an energy basket fully dominated by fossil fuels. Its dependency on fossil fuel (coal, oil and gas) is 92 percent against global average of 87 percent.

To cut import dependency, domestic exploration has to be stepped up.

"Out of total 3.14 million square kilometer sedimentary area, only 22 percent has been well explored and exploration been initiated in 44 percent of the balance area. But we still have 12 percent unexplored and 22 percent poorly explored areas," he said.

India has huge unexploited resource base, he said adding of the total prognosticated resource of 205 billion barrels of oil and oil equivalent natural gas, only 68 billion barrels has been established as in-place volume.

Even from producing fields, recovery factor is in the range of 25-33 percent whereas fields in North Sea or in Gulf of Mexico of same vintage have recovery factors of over 40 percent.

Moily said India has possesses huge potential for Coal Bed Methane (CBM) with a reserve base of over 450 trillion cubic feet. A greater potential of around 6900 tcf of gas exists from Underground Coal Gasification (UCG) prospects.

"It is also estimated that there exists a gas hydrate resource base of around 142 billion tonnes. In addition, Shale gas has an estimated potential of more than 65 Tcf," he said.

"We are still at a very preliminary stage when it comes to tapping these unconventional resources," he added.

As India grows to become the third largest economy by 2030, India's green-house-gases emissions is likely to increase from 5.0 to 6.5 billion tones carbon dioxide equivalent imposing the responsibility of making this growth process more environment-friendly, he said.

"Though our per capita CO2 emission is expected to increase from present level of 1.7 tons per annum to 3.7 tpa in 2030, which would be less than one-fourth of per capita emission of USA at that time, we are nonetheless concerned about the growing need of greening our supply and consumption chain," he said.

PTI


First Published: Tuesday, June 11, 2013, 18:00


Comments


comments powered by Disqus
G20 Summit 2014
G20 Summit 2014
2014`s Top People in Business: Fortune
2014`s Top People in Business: Fortune
World Bank`s Top 10 Places for Business
World Bank`s Top 10 Places for Business
India`s top ten billionaires
India`s top ten billionaires
Top 10 billionaire cities- In Pics
Top 10 billionaire cities- In Pics

Web Wrap
Contact Us : Privacy Policy : Legal Disclaimer
Copyright © Zee Media Corporation Ltd. All rights reserved