Investment for Creating Gas Infrastructure | 23 Dec 2020

Why in News

The government will invest around 60 billion USD in creating gas infrastructure in the country till 2024 and increasing gas’s share in the energy mix upto 15% by 2030.

  • Currently, gas accounts for 6% in the country’s total energy mix.

Key Points

  • Proposed Infrastructure Plan:
    • It includes pipelines, LNG (Liquefied Natural Gas) terminals and CGD (City Gas Distribution) networks.
    • It has been envisaged to develop additional about 14,300 km pipelines to complete the National Gas Grid and are at various stages of development.
    • At present, the country has 6 operational LNG regasification terminals.
      • The government has further planned to have 1,000 LNG fuel stations across the country.
    • Coverage of CGD projects is being expanded to 232 geographical areas spread over 400 districts, with potential to cover about 53% of the country’s geography and 70% of population.
  • National Gas Grid:
    • Since a National Gas Grid (NGG) was conceptualized in 2000, India has built more than 16,000 km of gas network. Recent initiatives include:
      • Pradhan Mantri Urja Ganga Project: It seeks to cater to the energy requirements of Uttar Pradesh, Bihar, Jharkhand, Odisha and West Bengal.
      • North East Region (NER) Gas Grid: It will pass through Assam, Sikkim, Mizoram, Manipur, Arunachal Pradesh, Tripura, Nagaland and Meghalaya in a phased manner.
  • City Gas Distribution (CGD) Network:
    • Under the Petroleum and Natural Gas Regulatory Board (PNGRB) Act 2006, PNGRB grants the authorization to the entities for developing a CGD network in a specified Geographical Area (GA) of the country.
    • The CGD sector has four distinct segments – Compressed Natural Gas (CNG) predominantly used as auto-fuel, and Piped Natural Gas (PNG) used in domestic, commercial and industrial segments.
  • Related Government Initiatives:
    • Natural Gas Marketing Reforms: Recently, the Cabinet Committee on Economic Affairs (CCEA) has approved the Policy framework on reforms in the exploration and licensing sector for enhancing domestic exploration and production of oil and gas.
    • Indian Gas Exchange: India’s first automated national-level gas trading platform was unveiled in June 2020, to promote and sustain an efficient and robust gas market and foster gas trading in the country
    • Pradhan Mantri Ujjwala Yojana: It aimed to provide free cooking gas connections to poor families.
    • Gas4India Campaign: It is a multimedia, multi-event campaign to communicate to people, the national, social, economic and ecological benefits of using natural gas as the fuel.
    • Hydrocarbon Exploration and Licensing Policy (HELP): It is a contractual and fiscal model for award of hydrocarbon acreages towards exploration and production (E&P). It provides a single, or uniform, license for the exploration and production of all conventional and unconventional hydrocarbons from an entire contract area.
    • Promotion to Compressed Natural Gas based Public Transport.
  • Transnational Gas Pipelines:
    • Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline.
    • Middle East to India Deepwater Pipeline

Natural Gas

  • Natural Gas is mainly extracted from the petroleum deposits deep beneath the earth. It occurs just above the layer of crude oil, as gases are lighter than oil.
    • High temperatures and pressure leads to the conversion of the remains of plants and animals buried under the earth into naturally occurring gas along with petroleum and coal.
  • In India, Jaisalmer, Krishna Godavari delta, Tripura and some areas offshore in Mumbai have natural gas resources.
  • The Gas Authority of India Limited was set up in 1984 as a public sector undertaking to transport and market natural gas.
  • Need for Gas-based Economy:
    • Energy efficient:
      • Natural gas produces more energy than any of the fossil fuels in terms of calorific value.
    • Cleaner fuel:
      • Natural gas is a superior fuel as compared with coal and other liquid fuels; being an environment-friendly, safer and cheaper fuel.
    • Emission commitments:
      • India made a commitment to COP-21 Paris Convention in December 2015 that by 2030, it would reduce carbon emission by 33%-35% of 2005 levels.
    • Diverse applications:
      • Natural gas can be used as domestic kitchen fuel, fuel for the transport sector as well as a fuel for fertilizer industries and commercial units.
    • Pacing up the progress line:
      • On the global front, switching to natural gas is bringing commendable results. The latest report released by the International Energy Agency shows that the electricity produced by natural gas worldwide was more than that of coal for the first time ever.