India sets ambitious target to increase natural gas share to 15% by 2030

The government has set an ambitious target to increase the share of natural gas in its total energy mix to 15 per cent by 2030, a substantial jump from the current 6 per cent, claimed Akshay Kumar Singh, the Managing Director and CEO of Petronet LNG, during the Leadership Panel on “Developing LNG markets and infrastructure” on the second day of India Energy Week’ 24 here in Goa.

Singh underscored the critical role of affordable pricing and synchronisation of infrastructure in the supply chain to achieve this target. The CEO further identified pricing as a key factor influencing the transition to cleaner fossil fuels, emphasising that unaffordable prices might divert consumers towards alternative energy sources.

“Unaffordable prices will force consumers to switch over to other fuels, and it’s imperative to calibrate it carefully so that high prices do not end up destroying demand,” Singh said.

He also advocated widespread adoption of Liquified Natural Gas (LNG) as part of the energy transition, citing its potential to replace a significant portion of crude oil, a substantial portion of which is imported. Currently, India imports around 45 per cent of the LNG used in the country.

Despite concerns about pricing, the senior official also noted that LNG offers the advantage of being distributable across the country and has the potential to replace 10-20 per cent of diesel used in transportation, thereby increasing the share of cleaner fuel in India’s energy mix.

Moreover, Singh acknowledged the Modi government’s commitment to transitioning the economy into a gas-based one, emphasising that large-scale LNG adoption could be facilitated through government intervention, particularly in adopting concessional taxation for the fuel.

Sukhmal Jain, Director (Marketing) and Member of the Board of Directors at BPCL, stressed that natural gas adoption is crucial for India to align with developed countries. He emphasised the need for aligning cost, supply efficiency, and taxation to promote natural gas use.

As part of the same panel, Andrew Barry, Chairman of ExxonMobil LNG Market Development and Vice President of Global LNG Marketing at ExxonMobil Oil and Gas Company, also highlighted LNG as an ideal partner for renewable energy, addressing intermittency issues associated with solar, wind, and hydro energy. He, along with other panellists, identified the cost of building LNG production and transmission infrastructure as a significant challenge in the widespread adoption of this cleaner fuel.

The discussions unfolded as part of the larger India Energy Week 2024, which is currently going on in this coastal state till February 9. It is anticipated that the event serves as India’s largest and only comprehensive energy exhibition and conference, fostering collaboration across the entire energy value chain.

The focus includes encouraging startups and integrating them into the energy value chain. The event is likely to draw the participation of 17 energy ministers from different countries, over 35,000 attendees, and more than 900 exhibitors, showcasing innovative solutions in the energy sector.

Prime Minister Narendra Modi has already held a roundtable with global oil and gas CEOs and experts, highlighting the significance of international cooperation in achieving India’s energy transition goals.