Lok Sabha Question No. 779 (UNSTARRED), answered on 2016-11-21
Subject: Gas Based Economy
Ministry: PETROLEUM AND NATURAL GAS
Asked by: JAYSHREEBEN  PATEL

## UNSTARRED QUESTION NO. 779

## TO BE ANSWERED ON 21.11.2016

## GAS BASED ECONOMY

## 779.     SHRIMATI JAYSHREEBEN PATEL:

Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state

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- (a) the concrete steps taken by the Government to make India a gas based economy and
- its likely impact on petroleum and natural gas production along with its prices; and
- (b) the amount of expenditure likely to be incurred by the Government thereon?

## ANSWER

पेट्रोलियम और प्राक ृ लिक गैस मंत्रािय में राज् य मंत्ररी (स् विंत्र प्राार ( श्ररी धमेन्द  र प्रधान

## MINISTER  OF  STATE  (INDEPENDENT  CHARGE)  IN  THE  MINISTRY  OF PETROLEUM & NATURAL GAS (SHRI DHARMENDRA PRADHAN)

- (a): Natural  gas  is  one  of  the  cleanest  and  most  environment  friendly  fuels  having extremely  low  Carbon  Dioxide  emissions  compared  to  other  fuels  like  coal  and  oil.  The Government has taken the following steps to make India a gas based economy:
- i. Development of Gas Sources either through Domestic gas Exploration & Production activities or through building up facilities to import natural gas in the form of LNG,
- ii. Development of Gas Pipeline Infrastructure and Secondary distribution network.
- iii. Development  of  gas  consuming  markets  like  Fertilizer,  Power,  Transport  and Industries etc.

Fertilizer and Power Sectors are the major gas consumers in Indian gas market. They consume about 60% of total gas consumption at country level in FY 2015-16.  In order to develop  the  gas  consuming  market,  Government  has  implemented  Fertilizer  Gas  Pooling Scheme which has encouraged the utilization of installed Fertilizer Units in the country.

On the Power Sector, Government has come up with a scheme to make operational the  stranded  gas  based  power  plants  on  R-LNG.  It  has  helped  in  reviving  Stranded  Power plants  of  around  16,000  MW  capacity  and  saved  them  from  becoming  NPA.  LNG consumption in Power sector has increased from the level of 3 MMSCMD during April-2015 (prior to Pooling) to a maximum level of 11.47 MMSCMD during March-2016.

Further,  the  Government  has  taken  several  steps  to  enhance  domestic  natural  gas production through several policy initiatives such as:

- (i) Policy to grant relaxation, extension, and clarifications at development and production stage for early monetization of hydrocarbon discoveries
- (ii) Marginal Field Policy- Discovered Small Field Policy
- (iii) Uniform Licensing Policy-Hydrocarbon Exploration and Licensing Policy
- (iv) Policy for Grant of Extension to small and medium sized discovered fields
- (v) Policy  for  Marketing  Freedom  for  Gas  Produced  from  Deepwater  and  Ultra Deepwater areas etc.; and
- (vi) Policy  on  testing  requirements  for  discoveries  made  under  New  Exploration  and Licensing Policy (NELP) Blocks.

To  incentivize  gas  production  from  difficult  areas,  Government  has  granted  marketing, including pricing, freedom for the gas produced from difficult areas. Marketing freedom has also been provided under  Discovered Small Field bidding round as well as under Hydrocarbon  Exploration  and  Licensing  Policy  (HELP)  under  which  acreages  will  be provided in future.

The  implementation  of  these  policy  initiatives  and  other  reform  initiatives  is  expected  to enhance domestic natural gas production from the fields.

(b):    The  Government  normally  does  not  provide  any  financial  support  for  laying  pipeline infrastructure. However, Government has taken a decision to provide a capital grant of Rs. 5176 crore (i.e. 40% of the estimated capital  cost of Rs.12,940 Crore) to GAIL for development of a 2539  Km  long  Jagdishpur-Haldia/Bokaro-Dhamra  Gas  Pipeline  (JHBDPL)  project  to  connect Eastern part of the country with National Gas Grid.

During the financial year 2015-2016, the CPSEs have incurred an approximate amount of Rs. 2962 crore on natural gas and other petroleum products pipeline infrastructure development.

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