India’s LNG imports surge despite soaring costs

Wednesday, 02 May 2018

Costs for LNG cargoes delivered to India’s three main import terminals – Dahej, Hazira and Dhabol – have jumped 50% to around $900 million, compared with $600 million in March 2017. Supplies amounted to 1.86 million tonnes of LNG, compared with 1.59MT brought in the same month last year, according to the figures from the Indian Ministry of Petroleum and Natural Gas.

“LNG import for the financial year 2017-18 was the highest ever import figure for the fuel,” the ministry stated, adding that costs for LNG purchases from April 2017 to March 2018 were $7.8 billion, significantly more than the $6.1 billion spent in FY2016-17.

India’s gross domestic production of natural gas, however, did not grow with the same pace as costs. For the month of March this figure was 2.78 Bcm, a rise of 1.18% compared with 2.75 Bcm in the same month of 2017. The cumulative domestic natural gas output for fiscal 2017-2018 was 2.35% higher at 32.64 Bcm vs. 31.89 Bcm in the previous fiscal year, the ministry reported.

Looking ahead, the ministry suggested that LNG imports could have been higher if more destinations on India’s east coast were available. The government is backing the development of a more comprehensive natural gas pipeline network as a precondition to shift India’s energy mix from coal to cleaner-burning natural gas, and renewables.