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GLNG ASIA GLNG
Indian gas reforms to spur LNG adoption
POLICY THE launch of India’s first natural gas exchange, six months from April 1.
coupled with recent changes to regulations gov- The Business Standard reported on June 18
erning liquefied natural gas (LNG) refueling sta- that IGX had delivered a market-discovered
tions, should help boost the super-chilled fuel’s price of $4.07 per mmBtu ($112.58 per 1,000
market penetration. cubic metres) within its first two days of opera-
Indian Minister of Petroleum and Natural tion. The platform reportedly traded 100 mmBtu
Gas Dharmendra Pradhan launched the Indian gas during that window.
Gas Exchange (IGX) on June 15. Multiple buy- “We have brought in 12 members and over
ers and sellers can now use the digital trading 350 clients so far. GAIL [India] and Petronet
platform to trade in spot and forward contracts have joined as our members,” the managing
for delivery at three physical hubs — Dahej and director and CEO of IGX-operator Indian
Hazira in Gujarat State, and Kakinada in Andhra Energy Exchange (IEX), Rajiv Srivastava, told
Pradesh State. the paper.
State-run Petronet LNG has a 17.5mn tonne State-run GAIL and Petronet have been
per year import terminal at Dahej, Shell operates joined by privately owned Adani Gas as well as
a 5mn tpy facility at Hazira and gas production Manikaran Power, GMR Energy Trading, Kreate
from the offshore Krishna-Godavari (KG) is Energy and Andhra Pradesh Gas Power, to name Buyers and
exported via pipeline to Kakinada. but a few.
Regassified LNG will be sold directly to buy- In addition to the IGX’s establishment, New sellers are also
ers, with the Indian Express quoting IGX direc- Delhi’s recent decision to remove restrictions
tor Rajesh Kumar Mediratta as saying on June on which companies can set up LNG refuelling expected to
16 that the move meant buyers no longer had to stations should also help expand the fuel’s reach.
“contact multiple dealers to ensure they find a The Petroleum and Natural Gas Regulatory benefit from
fair price”. Board (PNGRB) said earlier this month that greater contract
Buyers and sellers are also expected to ben- LNG stations would no longer be included in
efit from greater contract flexibility, with the city-gas distribution (CGD) licences, which flexibility.
exchange allowing contracts for next-day deliv- grant exclusive control of geographical areas to
ery alongside the more traditional long-term piped gas distributors.
supply deals. That decision, PNGRB chairman Dinesh
The local daily also quoted unnamed IGX Kumar Sarraf told S&P Global Platts on June 18,
officials as saying that a highly liquid gas should help develop small-scale and commercial
exchange could encourage the government to LNG use within the transport sector.
adopt reforms for the pricing of domestically “The traditional ‘LNG premium over gas’ has
produced gas. The central government sets narrowed down significantly. Therefore India
prices every six months using the weighted needs to develop this LNG fuel alternative. We
average price of gas in hubs in the US, Canada, have studied and found out that the [CGD] com-
the UK and Russia. New Delhi slashed prices panies are not necessarily the best bet to develop
for conventional gas production to $2.39 per LNG stations. Therefore we have opened up the
mmBtu ($66.11 per 1,000 cubic metres) for the LNG sector,” Sarraf said.
P14 www. NEWSBASE .com Week 24 19•June•2020
