India foresees investments of around Rs 10 billion over three years to create infrastructure to use liquefied natural gas as fuel for long-distance transportation. This will also include the installation of 1,000 LNG stations.
As a first step towards this, on Thursday, the major companies in the industry launched 50 stations. This includes 20 stations from IndianOil Corporation (IOC), 11 from Hindustan Petroleum Corporation and Bharat Petroleum Corporation, six from GAIL India, and two from Petronet LNG. The states where the top outlets will emerge in the first leg include Gujarat (10), Andra Pradesh (six), Karnataka (five), Kerala (three), Tamil Nadu (eight) and Rajasthan (three).
Launching the 50 retail outlets in the golden ring, Oil Minister Dharmendra Pradhan said: “India is moving towards next generation infrastructure. In the next three years, 1,000 LNG stations will appear and the sector may see an investment of the order of 10 billion rupees for this. This will bring a big change in logistics and transportation. “In the next year, about 150 fuel stations of this type are expected to emerge in the golden quadrilateral, where the strategy is to have an LNG station every 200 kilometers.
The government expects at least 20-25 mmscmd (million metric standard cubic meters per day) to reach the transportation sector in India in the near future.
Pradhan said that LNG has the potential to take a share of at least 10 percent of the total 10 million trucks in India. Also in the mining sector, the government aims to convert heavy vehicles and equipment to LNG. “When you compare diesel and LNG, LNG is 40% cheaper. In heavy vehicles, if spending by 40% decreases, it will be a win-win situation: logistics costs will be reduced, and it will also have a positive impact on inflation, ”added Pradhan.
India’s LNG imports increased by 18 percent from 28,740 million metric standard cubic meters in 2018-19 to 33,887 MMSCM in 2019-20. Interestingly, due to Covid, the cumulative import of 15,881 MMSCM for the current year from April to September was 3.3 percent lower compared to the corresponding period of the previous year. India currently has six LNG terminals: Dahej, Hazira, Dabhol, Kochi, Ennore and Mundra, with a total capacity of 42.5 MMTPA (million metric tons per year).
“LNG is a cheaper fuel, if we buy more LNG, dependence on crude will be reduced. This can also control world oil prices, if India reduces its dependence on that fuel, “he added. The minister indicated that the move is also a step towards a gas-based economy, as the government is doing in the case of city gas distribution and also through the Ujjwala campaign in liquefied petroleum gas.
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