India is the world’s fourth largest consumer of primary energy and accounts for about 4.6 per cent of the world's energy consumption after China, US and Russia.
Vandana Hari, Asia Editorial Director, Platts, believes that India’s tremendously growing energy demand has made the country an energy leader on the global platform with more than 28 billion tonnes of prognosticated reserves.
The Government of India's New Exploration Licensing Policy (NELP) launched in 1997-98 has garnered investments over US$ 14 billion and has resulted in 87 oil and gas (O&G) discoveries. NELP has encompassed all the ingredients of a favourable investment climate, fiscal stability, transparency of the rule of law, contract stability, minimal policy induced uncertainties and a stable legal and regulatory framework.
The refining sector in India has also undergone a silent transformation wherein the country emerged as a major export hub. With a refining capacity of 215 million metric tonnes per annum (MMTPA), exports of petroleum products have now crossed 60 million tonnes (MT), raking-in revenues of about US$ 60 billion. ‘Petroleum products’ have emerged as the single largest component of merchandise exports from India.
The hydrocarbons sector is continuously undergoing changes and policy modifications are in-tune with them. Natural gas is rapidly contributing to the energy requirements owing to commercial development of coal bed methane, shale gas, underground coal gas and gas hydrates.
President Pranab Mukherji anticipates that natural gas usage will increase significantly in the years to come while urging the need to connect various parts of India with gas pipelines so that economic benefits of natural gas reach to all. The Government of India (GoI) is also lending full support to companies acquiring overseas O&G assets and imports of liquefied natural gas (LNG).
India's shale gas reserves are at about 290 trillion cubic feet (TCF), of which 63 TCF could be recovered, according to a study by US Energy International Agency. Shale gas is natural gas formed from being trapped within shale formations.
Natural gas sector constitutes about 9.8 per cent of primary energy consumption which is projected to grow up to 20 per cent by 2025 as per Indian Hydrocarbon vision. About 65 per cent of natural gas consumption is accounted by power and fertiliser sectors. Petroleum and Natural Gas Regulatory Board chairman S. Krishnan stresses on the need to evolve a strategy to meet significantly higher share of energy needs from natural gas and take its contribution in the country’s energy basket from 9.8 per cent to 25 per cent in the medium term.