Invoking the Essential Commodities Act, 1955, the Ministry of Petroleum and Natural Gas (MoPNG) has sought diverting natural gas to certain precedence sectors with a tiered construction.
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In a gazette notification dated March 9, the Ministry underlined home piped natural gas (PNG), Compressed Natural Gas (CNG) for vehicular gasoline, and Liquified Petroleum Gas (LPG) manufacturing alongside fertilizer manufacturing, tea industries, manufacturing and different industrial customers, among the many precedence sectors.
The gazette underlined the precedence allocation was mandated in gentle of disruption of LNG shipments routed by the Strait of Hormuz, and Indian suppliers obligated to invoked pressured majeure due to the continuing tensions in West Asia. At current, about 30% of India’s natural gas necessities are routed by the Strait of Hormuz.
Earlier this week, the federal government had invoked the Essential Commodities Act for prioritising LPG provide to home customers.
Structured allocation
The gazette notification launched tiered allocation priorities to every of those sectors. For instance, home piped natural gas provide, CNG for transport and LPG manufacturing, amongst others, have been accorded for “priority allocation” with provides to be upheld uninterrupted at “hundred per cent”, topic to operational availability. This could be premised on their common consumption from the earlier six months.
Similarly, fertilizers’ crops could be provided 70% of their consumption necessities, premised on their common consumption within the earlier six months.
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Further, gas advertising and marketing firms have been requested to guarantee industries, manufacturing and different industrial customers, provided by the natural gas grid, obtain eighty per cent of their necessities underneath the construction. Additionally, CGDs have been requested to guarantee industrial and industrial customers additionally obtain the identical provide.
The gazette additional states that the redistribution could be facilitated by “full or partial curtailment” of gas being provided to ONGC Petrol additions Limited, GAIL Pata Petrochemical and Reliance O2C, amongst others. “The oil refining companies shall absorb the impact of LNG supply disruption to the extent feasible by reducing gas allocation to refineries to approximately sixty five per cent. of the past six months’ gas consumption, subject to operational feasibility,” the gazette learn.
India’s natural gas consumption at current is 195 million metric commonplace cubic metres per day (MMSCMD), of which it imports half of its necessities.
