According to a medium-term prediction by the International Energy Agency (IEA), India’s natural gas demand will increase by 4% in 2023 and by over 8% annually on average through 2026. It also revealed that the average annual growth rate of the world’s gas consumption between 2022 and 2026 will be 1.6%, down from an average annual growth rate of 2.5% between 2017 and 2021.
Liquefied natural gas (LNG) imports into India climbed by 8% in the first eight months of 2023 compared to the same period in 2022, following a sharp fall of 6% in 2022. The primary gas supply went raised by 2%.
India is expected to increase its consumption for natural gas by more than 20 billion cubic meters (bcm) during the next five years. With a projected contribution to this rise of close to 40%, the industry is expected to continue as the key driver.
Along with Ennore, the seventh LNG import facility and second on the East Coast increased India’s overall capacity for regasification by 10%. LNG is used to transport liquid natural gas to terminals. In the regasification process, the LNG is heated to return it to a gaseous condition, following which it is delivered through pipes.
The demand for regasified LNG in the fertiliser sector increased by over three times during the first eight months of 2023 compared to the same period in 2022, according to statistics from the Petroleum Planning and Analysis Cell. Government incentives and better connections for fertiliser plants in southern India were largely to blame.
Since urea imports are anticipated to cease entirely by the end of 2025, the fertiliser industry is anticipated to play a significant role in driving India’s rising industrial gas demand. By 2030, the government plans to increase gas’s current part of its energy consumption mix from 6% to 15%. Currently, the nation imports over 50% of its gas needs. India’s energy consumption is increasing 4% to 5% a year.
However, by 2026, it is anticipated that natural gas output will rise by over 6%, or 240 bcm. Nearly 80% of the net growth is anticipated to come from North America and the Middle East. Russia’s production is anticipated to stay much below the record highs recorded in 2021.