Petroleum ministry exercise on natural gas data (2010-11 up to 2029-30): Gas sales to touch 729 MMSCMD in 2030 under optimistic scenario

A recent exercise by the petroleum ministry on natural gas production and sales projections for the period 2010-11 up to 2029-30 has come up with some interesting data. The domestic production estimation is drawn from DGH’s projection up to 2016-17 which is based on established reserves. From 2017-18 and onwards, the projection is based on GAIL`s internal estimation considering additional gas from RIL, ONGC, GSPC, OIL, CBM blocks and other future discoveries. Two scenarios, one optimistic and the other pessimistic, have been projected as under: 

  Optimistic scenario:

• The domestic production of natural gas is pegged at 146 MMSCMD in 2010-11. Under this scenario, the production projection is seen to be on an upward trajectory throughout the 20-year period. Gas production is projected to go up to 527 MMSCMD by 2029-30.
• The production projections cross the 200 MMSCMD mark in 2014-15. It crosses the 300 MMSCMD, 400 MMSCMD and 500 MMSCMD mark in 2020-21, 2025-26 and 2029-30 respectively.
• Under the optimistic scenario, cumulative annual growth rate is pegged at 6%.
• LNG imports are pegged at 33 MMSCMD in 2010-11. These also move up consistently and touch 99 MMSCMD in 2014-15 when supplies from Gorgon are expected to arrive under long-term contract. In 2015-16, imports are pegged even higher at 117 MMSCMD. For 2016-17 and 2017-18, the LNG imports are projected to remain steady at 126 MMSCMD.
• However, from 2019-20 onwards, up to 2029-30, LNG imports are pegged at a constant 162 MMSCMD.
• As the cross-border pipelines -- which include TAPI and IPI pipelines -- are expected to be in operation from 2018 onwards, another 40 MMSCMD is expected to flow into the country from 2018-19 onwards through this route.
• Total gas sales, which are pegged at 179 MMSCMD in 2010-11, are estimated to go up to 729 MMSCMD in 2029-30.
•   Pessimistic scenario:
• Even in a pessimistic scenario, no changes are seen in LNG import estimations. They are exactly the same as taken in the optimistic scenario. LNG imports are fixed at 162 MMSCMD assuming that no new LNG terminals will come up during the time.
• However, 40 MMSCMD of gas, which is estimated to flow into the country through cross-country pipelines is not taken into account in the pessimistic scenario. It is assumed that no cross-border pipelines will be operational till 2030. This reduces the total gas imports to 162 MMSCMD, for the period 2019-20 up to 2029-30.
• The domestic production estimations are also exactly the same as projected under the optimistic scenario till 2016-17. However, from 2017-18 onwards, variations can be seen. From 2017-18 onwards, GAIL has assumed a domestic production growth of 3% over previous years, that is, half of the growth rate considered under the optimistic scenario.
• The total domestic production projections are pegged at 363 MMSCMD in 2029-30, which is much lower than the optimistic projection of 527 MMSCMD for the same year.
• Sales are estimated at 525 MMSCMD by 2029-30, as against 729 MMSCMD projected under the optimistic scenario.