Mumbai, Feb 02: India's gas consumption is expected to rise 2.5 times over the next five years, requiring USD 11 billion in infrastructure spending, the chairman of the country's largest gas utility, GAIL India Ltd said on Monday. "A quantum jump in consumption is clearly a strong possibility. At least two and a half times the current number will definitely be reached in four to five years time," Proshanto Banerjee said on the sidelines of a gas conference.
India produces about 65 million cubic metre, or 2.3 billion cubic feet, of natural gas a day, meeting less than half of the country's potential demand.
Gas supplies are set to rise with imports of liquefied natural gas (LNG) and following the development by Reliance Industries of 14 trillion cubic feet (tcf) of reserves it discovered off southeastern India in 2002.
Analysts say India's industry has pent up demand for gas, which could undercut costlier fuels like naphtha and diesel.
GAIL is planning a USD 4.4 billion national gas grid, but investment in regional and local distribution would also be needed, the chairman said.
"A national gas grid has to be supported by regional grids. They will in turn have to lead to city gas distribution networks and there will be investment in vehicles that will run on CNG," he said, referring to compressed natural gas (CNG).
Banerjee, who hopes GAIL can maintain 15 per cent profit growth a year for the next five years, said the firm was planning to set up a CNG network in 22 cities.
This would include pipelines to transport the gas and CNG filling stations.
Bureau Report