India's demand for LNG is set to rise significantly by 78pc to 64bn m³ by 2030 to meet its rising demand for natural gas, the International Energy Agency (IEA) said.
This is up from 36.17bn m³ in 2024, according to IEA's India Gas report released at India Energy Week on 12 February.
LNG imports would increase to account for 62pc of India's gas consumption, which is expected to hit 103bn m³ by 2030, it added. Imports accounted for 50pc of gas consumption in 2024, out of 72bn m³, oil ministry data show.
The rise in demand would be backed by the rising city gas distribution (CGD) sector supported by the rapid expansion of its compressed natural gas (CNG) infrastructure and gas in industrial use, the report said. Targeted strategies and policy interventions may also boost gas consumption beyond the forecasted level to around 120bn m³ by 2030, according to the report.
The rise in LNG imports would necessitate additional LNG import capacity beyond 2025, IEA said. The gap between contracted LNG supply and projected LNG requirements is set to widen significantly after 2028, it added.
This "may leave India more exposed to the volatility of the spot LNG market unless additional LNG contracts are secured in the coming years," the report said.
But production may not keep pace with demand. IEA expects India's domestic gas production, which currently meets 50pc of demand, to grow only moderately to just under 38bn m³ by 2030.
India's gas output totalled 36bn m³ in 2024, oil ministry data show.
IEA expects overall production growth to be limited by plateauing output from the KG-D6 fields and declining production from legacy assets like ONGC's Mumbai offshore fields, which may offset the increasing onshore production from coal bed methane (CBM) and discovered small fields (DSF) and from the additional supplies from ONGC's deepwater KG-D5 project.
But India's compressed biogas (CBG) production potential remains largely untapped, with annual output expected to reach 0.8bn m³ by 2030, IEA said.
Sectoral demand
Gas demand for power and industrial sectors is expected to each take up 15pc of demand by 2030, equivalent to around 15bn m³ respectively, based on the normalised trajectory of consumption hitting 103bn m³ by 2030, IEA said in its report.
Gas consumption from refineries is also expected to increase by more than 4bn m³ by 2030 as more refineries are connected to the grid, it added. Gas usage by refineries totalled 5bn m³ in 2024, oil ministry data show.
But growth prospects in the petrochemical and fertilizer sectors remain limited, as there are no new gas-based capacity additions planned, it added.
The think tank expects some new demand centres to emerge as a result of higher utilisation of India's stranded gas-fired power plants, faster adoption of LNG in heavy-duty transport, more rapid expansion of India's CGD infrastructure, combined with the replacement of LPG with natural gas in the commercial sector.
Challenging targets
But IEA expects India's 15pc target of natural gas use in the primary energy mix will be challenging to meet, owing to India's gas development pathway prioritising affordability and energy security.
"Inter-fuel competition is particularly strong in India, with natural gas vying against coal, oil and renewables in several gas-consuming sectors," according to the IEA report.
Even small changes in global gas prices can significantly impact domestic consumption patterns, the report added. Competitive pricing is needed to enable natural gas adoption given the price sensitivity.
