Report

India Natural Gas Market is anticipated to grow at a steady pace in the forecast period, 2024-2029. Natural gas demand in India is being driven by factors like low cost of gas and growing concerns over greenhouse gas emissions. By implementing new price guidelines for companies producing nationally, the government is encouraging the production of natural gas in India. Additionally, the government is promoting the extraction from unconventional resources including shale gas and coalbed methane (CBM). The pipeline network is quickly growing, and more pipes are expected to be put into service during the next five years. For instance, the Indian government has taken the effort to accomplish its goal of 15% natural gas in its energy basket mix by 2030, which was at 6.2-6.6% in 2021, compared to the global average of 23-24%. After the forecast period, it is anticipated that this increase will present a growth opportunity in the India Natural Gas Market.
Natural gas is used mostly in the commercial sector to heat buildings and water. Natural gas additionally serves as a fuel for some business applications' combined heat and power systems. Methane (CH4) makes up the majority of the odorless, gaseous combination of hydrocarbons that is natural gas. A little over 40% of the fuel is used to generate electricity, with the remainder going to industrial, household, and commercial applications including cooking and heating. Only approximately 2% of natural gas is used as a fuel for transportation, even though it is a tried-and-true alternative fuel that has long been used to power natural gas vehicles.
Increasing Investment in Pipelines to Drive the Market
The pipeline is currently the most cost-effective method of moving natural gas across vast distances and due to these increasing investments, the new pipeline systems are gaining attention. For instance, the construction of a new 16,000-kilometer gas pipeline network in India began in 2022 and is anticipated to be finished in the following four to six years. As of 2021, according to the prime minister of India, the Gas Authority of India Ltd (GAIL) controlled the widely held 32,718 km-long natural gas pipeline network and these investment in networking of these pipeline is growing rapidly.
Additionally, the Indian government has a plan approved for USD 774 million for a natural gas pipeline in the northeastern region as a component of a national gas grid being constructed to connect distant parts of the nation. The 1,656 km pipeline is anticipated to be finished in 2023 and cost up to USD 1.13 billion. Even throughout the pandemic, the country's natural gas usage has risen. It is predicted to increase from 26.9 billion cubic meters in 2019 to roughly 23.8 billion cubic meters in 2020. Thus, the India natural gas market has been pushed by rising midstream investments. During the forecast period, pipeline coverage is also estimated to rise significantly, with the pipeline for petroleum products likely to grow the most in the nation. Due to the increasing investment in pipelines people are moving towards natural gas consumption, hence the India Natural Gas market is expected to grow in the future period.
Government Initiatives Booming the Market Growth
According to Dharmendra Pradhan, the Union Minister of Petroleum, Natural Gas, and Steel, the federal government intends to invest USD 60 billion over the next four years to build a gas infrastructure in India, including LNG facilities and gas pipelines. The Prime Minister set the goal of "One nation, One Gas Grid" in 2021. A new 17000 km gas pipeline would bring India's natural gas grids with the total length to 34500 km.
By 2022, the current regasification capacity of 42 million metric tons per year was increased 61 million metric tons per year. Prime minister announced that the potential coverage of the city gas distribution projects has been increased by 232 additional geographic areas dispersed over 400 districts, with the capacity reach of 70% of the people and 53% of the country from land area.
Growing Usage of Piped Natural Gas (PNG) Driving the Market Growth
According to the Petroleum and Natural Gas Regulatory Board (PNGRB) Act 2006, PNGRB authorizes the development of City Gas Distribution (CGD) networks, including PNG networks, in specific geographical areas (GA) across the nation. These organizations have developed into the country's expanding PNG industry, owing to which the market is expanding.
In April 2022, Letters of intent (LoI) were issued to the three successful entities for the retail sale of compressed natural gas (CNG) to automobiles and piped natural gas (PNG) to homes in five geographical areas (GAs), dispersed over 27 districts in five states. This was approved by PNGRB at its 111th board meeting. Furthermore, for the government's "Atmanirbhar Bharat" program to succeed, expanding the distribution area and developing a gas-based economy are essential. For example, "One Nation One Gas Grid" is the direction in which work is being done. In order to supply gas to diverse participants, it is necessary to integrate these regional systems and create a national grid.
LNG usage increased by 59.3 billion cubic meters in 2019 to roughly 56.9 billion cubic meters in 2020. The pipeline grid is anticipated to accelerate the development of municipal gas projects and boost access to renewable energy, hence promoting the demand for natural gas pipelines.
Increasing Demand for Petroleum Products
An examination of data made public by the Petroleum Planning & Analysis Cell (PPAC) of the Oil Ministry reveals that India's consumption of petroleum products reached a record high in the fiscal year 2022-23, highlighting the strong demand for transportation fuels and several other refined goods. The usage of the three main fuels-diesel, petrol and liquefied petroleum gas (LPG)-broke all prior records for the year that ended in March 2021. Consumption of petroleum products is used as a proxy for monitoring developments in industrial activity and residential consumption, as well as a gauge of the demand for crude oil.
In 2022-2023, India consumed 222.30 million tonnes of petroleum products, an increase of 10.2% year over year (YoY). The previous record for petroleum product consumption, according to an examination of historical data, was 214.13 million tonnes in 2019-20. Due to the pandemic, the demand declined in 2020-2021 before seeing a moderate recovery in 2021-2022. Demand for the majority of goods exceeded pre-COVID highs in 2022-2023 as different economic sectors fully recovered from the pandemic's effects. According to predictions made by PPAC and announced in late February 2023, the nation's consumption of petroleum products will reach a new high of 233.81 million tons in 2023-24.
In Financial year 2022-2023, India used 85.90 million tonnes of diesel. Now the most popular fuel in India is diesel, which accounts for about 40% of the nation's total consumption of petroleum products. The nation consumed 34.98 million tonnes of petrol, an increase of 13.4% year over year. Even though it was only 0.9% higher YoY in 2022-2023, India's LPG consumption even reached a new high of 28.50 million tonnes and the amount of LPG consumed is anticipated to increase to 29.12 million tonnes from 2023-2024. The PPAC forecasts diesel demand to increase to 90.56 million tonnes in 2023-24. Stronger growth in the transport and some industrial sectors can be seen in the higher demand for these two fuels.
Market Segmentation
India Natural Gas market is segmented based on type, application, region and competitive landscape. Based on type, the Natural Gas market of India can be segmented into Compressed Natural Gas, Piped Natural Gas and Liquified Petroleum Gas. Based on application, the market can be segmented into Industrial, Electric Power, Transportation, Residential, Commercial, Others.
Market Players
Major market players in the India Natural Gas Market are GAIL (India) Limited, Gujarat State Petronet Limited (GSPL), Indraprastha Gas Limited (IGL), Mahanagar Gas Limited (MGL), Oil and Natural Gas Corporation (ONGC), Oil India Limited (OIL), Reliance Industries Limited, Cairn Oil & Gas vertical of Vedanta Limited, Essar Global Fund Limited, Petronet LNG Limited (PLL).
Report Scope:
In this report, the India Natural Gas Market has been segmented into following categories, in addition to the industry trends which have also been detailed below:
� India Natural Gas Market, By Type:
o Compressed Natural Gas
o Piped Natural Gas
o Liquified Petroleum Gas
� India Natural Gas Market, By Application:
o Industrial
o Electric Power
o Transportation
o Residential
o Commercial
o Others
� India Natural Gas Market, By Region:
o West India
o North India
o South India
o East India
Competitive Landscape
Company Profiles: Detailed analysis of the major companies present in the India Natural Gas Market.
Available Customizations:
India Natural Gas Market report with the given market data, Tech Sci Research offers customizations according to a company's specific needs. The following customization options are available for the report:
Company Information
� Detailed analysis and profiling of additional market players (up to five).