LNG

The Indian government aims to expand LNG import capacity to 66.7 mtpa by 2030 – a 27% rise from the current 52.7 mtpa – thanks to two projected regas terminals. The build-out aligns with government policies to more than double the share of gas in the national power gen mix to 15% by the end of the decade.

Two Indian state-backed oil and gas companies have signed an accord to develop the Hatta natural gas field in the Vindhyan basin of Madhya Pradesh in Central India, including building an LNG liquefaction plant to supply the off-grid and transportation fuel markets.

The two companies involved are Oil and Natural Gas Corp. (ONGC), a company owned by India’s Ministry of Petroleum and Natural Gas as is its partner in the venture, Indian Oil Corp. Ltd (IOCL) whose activities are focused on refining petroleum products and producing petrochemicals, though both are already involved in the LNG sector.

ONGC and IOCL have signed a memorandum of understanding to establish a medium-sized LNG plant as part of the Hatta gas field development plan.

“The establishment of the Hatta LNG plant will significantly enhance the Vindhyan Basin's status,”  explained ONGC.

“The plant will utilize cutting-edge technology to produce LNG, a cleaner alternative to traditional fossil fuels, significantly reducing carbon emissions and aligning with India's climate change mitigation goals,” ONGC added.

LNG sector

ONGC has subsidiaries already involved in LNG including Hindustan Petroleum Corp., the owner of India’s newest LNG import facility, the Chhara terminal located in the state of Gujarat and with 5 million tonnes per annum of capacity.

Another unit, ONGC Videsh, is one of three Indian companies who share a 20 percent stake in the TotalEnergies-operated Mozambique LNG project Area 1 licence in the Rovuma Basin of the southeast African nation.  

IOCL is also involved in LNG through its ownership of the LNG import terminal at Kamarajar Port in the East Coast state of Tamil Naidu with 5 MTPA of regasification capacity.

Both ONGC and IOCL are additionally associated and founding companies of Indian’s largest LNG importer, Petronet LNG which has West Coast import terminals at Dahej and Kochi.

ONGC said that the gas discovery at Hatta “represented the culmination of five decades of sustained exploration” efforts.

“ONGC has already submitted its Field Development Plan (FDP) to the Directorate General of Hydrocarbons to monetize its assets in the Hatta area,” stated the company.

The establishment of the Hatta gas field and the LNG plant will enhance the Vindhyan Basin’s status, upgrading it from a Category II to a Category I Basin.

India's sedimentary basins, covering a total area of 3.4 million square kilometres, are divided into three categories.

Category I is for basins with hydrocarbon reserves that are already producing; Category II is for resources with commercial production pending; and Category III are prospective areas where resources may be discovered.

Earnings

The submission of the Hatta gas development plan follows ONGC’s record fiscal-year net profits reported in May 2024 and amounting to 40,526 crore Indian rupees (US$4.85 billion).

However, gross annual revenues fell by over 6 percent to 643,037 crore rupees ($76.94Bln) as prices tumbled.

ONGC’s annual realised natural gas price dropped by 10.8 percent for the year to US$6.55 per million British thermal units from US$7.34 per MMBtu in the previous fiscal year.

The average crude oil price declined by 18.4 percent to US$75.91 a barrel from $93.02 per barrel in the 2022-2023 fiscal year.

Indian liquefied natural gas imports continued their 2022 decline as rising cargo costs stemmed demand in West Asia and the Indian economy showed signs of slowing as natural gas demand was flat in industrial sectors.

Indian imports of liquefied natural gas dropped by 2.7 percent in July, the 11th straight monthly decline, as LNG prices have increased in the spot market and continue to curb purchases in Asia.

Indian Oil Corp. (IOC), the country’s main oil refiner and importer and the owner of the nation's only East Coast LNG import terminal at Ennore, posted a 16 percent increase in net profits even as margins were tight in the petrochemicals industry and losses were made on partly subsidized fuels.

Indian liquefied natural gas imports increased by almost 12 percent last month and were on track for record fiscal-year and calendar-year totals as shipments increased due to rising demand, backed by higher terminal capacity use and a steady infrastructure build-out.

Indian liquefied natural gas imports fell last month by just over 9 percent with cargoes arriving at a slower pace from suppliers in Qatar, West Africa, Australia and the US as the nation also received its commissioning cargo in late February for the first import terminal on the East Coast.

Chart Industries, the US LNG equipment-maker for production, storage and distribution, and Indian Oil Corp, owner of the first import terminal to start up on the Indian East Coast, have signed an accord to promote the development of the LNG market in the Asian nation.

Indian Oil Corp., the refining and fuel marketing company, has started commissioning the first liquefied natural import terminal on the East Coast of India near the city of Chennai with a shipment from Qatar.

The new terminal is located at Kamarajar Port in the southeast state of Tamil Nadu .

The commissioning cargo was unloaded from the 160,000 cubic metres capacity carrier “Golar Snow” after being lifted from the Qatargas export complex at Ras Laffan on February 17 and delivered to Kamarajar where the vessel was still moored on March 4.

During the cool-down process all the systems and infrastructure at the newest Indian terminal are being made ready to safely receive and handle regular cargoes and regasified LNG.

The storage tanks and all the related terminal equipment were cooled with vapour to take the first cargo.

Indian Oil’s terminal at Kamarajar, formerly one of India’s main coal ports and previously called Ennore, will have annual capacity of 5 million tonnes per annum.

Kamarajar is India’s sixth LNG import terminal and is expected to spur industrial growth in the area with the regasified LNG being distributed to power generation plants, fertiliser plants and other industrial units.

Indian Oil is the main stakeholder in the facility, though other investors have been named as the Indian private equity fund, IDFC Alternatives, and ICICI Bank, part of an Indian multinational banking and financial services company based in Mumbai.

Once the Kamarajar terminal is fully commissioned it will join the five other facilities on the West Coast at Dahej, Dabhol, Hazira, Mundra and Kochi to supply India’s growing natural gas needs.

Analysts said the coming on stream of this first regasification facility on the East Coast is a landmark in Indian Oil's efforts and those of the government to improve natural gas infrastructure in the country.

The Kamarajar terminal is located about 25 kilometres north of Chennai Port and initially the imports will supply natural gas to industry in the Manali area, including Madras Fertilizers Ltd., Chennai Petroleum Corp. and Tamil Nadu Petroproducts.

The venture and several other East Coast terminals under development will rebalance the nation’s regasification infrastructure with East Coast import capability.

Indian Oil is also pursuing city-gas projects and another East Coast LNG terminal with Gas Authority of India and the Adani Group.

With GAIL and Adani, Indian Oil is developing the Dhamra project in the state of Odisha.

The Dhamra terminal will bring in LNG imports to serve city-gas and power projects as well as industrial customers.

Indian liquefied natural gas imports fell last month by 11.6 percent with cargoes arriving at a slower pace from the main suppliers in Qatar and West Africa as the nation prepared to start commissioning the first import terminal on the East Coast.