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India Eyes 2-Week LNG Storage Boost
25 Sep
Summary
- India plans 15 new LNG storage tanks, adding two weeks capacity.
- Investment of ₹15,000 crore is required for this critical infrastructure.
- New storage aims to cushion consumers from global price surges.
India is advancing plans to construct 15 additional overground liquefied natural gas (LNG) storage tanks, a project estimated to cost ₹15,000 crore. This initiative is designed to increase the country's LNG storage capacity by approximately two weeks. The current storage capacity stands at 12 days across over 20 tanks.
The proposed expansion aims to mitigate risks associated with India's heavy reliance on LNG imports, which currently meet nearly half of its natural gas consumption. Increased storage will serve as a buffer against supply disruptions and volatile global prices, particularly in light of ongoing conflicts in West Asia.
To finance this critical infrastructure, a surcharge of about 10% on pipeline tariffs may be implemented by the gas regulator. While this could lead to a minor increase in consumer tariffs, its impact is expected to be spread across the value chain, minimizing the burden on individual users.
This development aligns with India's long-term strategy to increase the share of natural gas in its energy basket to 15% by 2030 from the current 6%. The Petroleum and Natural Gas Regulatory Board (PNGRB) and state-run gas companies are involved in finalizing the project details.
