Request you to kindly drop in all your mails/queries to support@infraline.com or call us at
+91-120-6799125 (D); +91-120-6799100 (B)

infra-search

User Name

Password

Forgot Password?


Set as Default

Published:Thursday, March 12, 2020 5:09 PM

Midstream Industry in India - Crude Oil, Petroleum Products & Natural Gas Pipeline- Challenges & Opportunities

Midstream Industry in India - Crude Oil, Petroleum Products & Natural Gas Pipeline- Challenges & Opp

Gas Pipeline infrastructure is an efficient and reliable mode of transporting the natural gas by linking gas sources to gas consuming markets. Gas pipeline grid defines the structure of the gas market and its development. Consequently, an interconnected National Gas Grid has been predicted to make sure the sufficient availability and impartial distribution of natural gas in all parts of the country. There are presently 3 major pipeline entities involved in natural gas transportation across India namely GAIL, RGTIL/RGPL and GSPL. GAIL is operating about 12160 km of trunk pipelines in India comprising 71% of the pan-India pipeline network. This includes HVJ, DVPL, DUPL/DPPL, DadriBawana-Nangal and Dabhol-Bengaluru trunk pipelines to evacuate domestic gas as well as imported RLNG. In addition, GAIL also operates regional gas pipeline networks in Maharashtra, K.G. Basin, Cauvery Basin and Gujarat. RGTIL and RGPL are operating 1774 km of pipelines (about 10% of pan India network), namely the East-West Pipeline (EWPL) to evacuate gas from KG-D6 field in Andhra Pradesh and the Shadol-Phulpur Pipeline respectively. GSPL is mainly focused in the state of Gujarat consisting of about 2692 km gas pipelines (about 16% of total). The natural gas is primarily sourced from KG-D6, Mumbai offshore, Cambay Basin, Ravva Offshore, KG Basin, Cauvery basin and through import of LNG.

 

Current Scenario of Pipelines:

At present, the country’s operational natural gas pipeline infrastructure spans over 16,981 km with total capacity 388 MMSCMD. Another 14,000 km of pipelines are at several stages of development or planning. Crude Oil Pipeline covers total length of 10,419 KM with total capacity of 148 MMTPA. Product Pipeline Network traverse’s total length of 18,169 with total capacity 111.30 MMTPA.
 
Natural Gas Pipeline Network (March 2020)
 
S. no.
Transporter
Length in KM
Capacity (MMSCMD)
Market Share in Pipeline Network
1
GAIL
12,160
246
71.6%
2
RGTIL / RGPL
1,774
84
10.4%
3
GSPL
2,692
43
15.9%
4
AGCL/DNPL
215
5
1.3%
5
IOCL
140
10
0.8%
 
Total
16,981
388
 
 
Indian Oil operates a network of total 14,189 km long including crude oil, petroleum product and gas pipelines with a throughput capacity of 94.79 million metric tonnes per annum of oil and 9.5 million metric standard cubic meters per day of gas.
 
Crude Oil Pipeline Network (March 2020)
S.no
Transporter
Length (KM)
Capacity (MMTPA)
Market Share in Pipeline Network
1
ONGC
1,283
60.6
12%
2
OIL
1,193
9
11%
3
Cairn
688
10.7
7%
4
HMEL
1,017
11.3
10%
5
IOCL
5,301
48.6
51%
6
BPCL
937
7.8
9%
 
Total
10,419
148.0
 
 
Product Pipeline Network (March 2020)
S. no.
Transporter
Length in KM
Capacity (MMTPA)
Market Share in Pipeline Network
1
OIL
654
1.7
3.6%
2
IOCL
9,104.00
46
50.1%
3
BPCL
2,241.00
19.5
12.3%
4
HPCL
3,775.00
34.7
20.8%
5
Others*
2,395.00
9.4
13.2%
TOTAL
18,169.00
111.30
*Others include GAIL and Petronet India. HPCL and BPCL lubes pipeline included in products pipeline data
 
City Gas Distribution (CGD) Networks:
 
  • Under the Petroleum and Natural Gas Regulatory Board (PNGRB) Act 2006, PNGRB grants the authorization to the entities for developing a City Gas Distribution (CGD) network (including PNG network) in a specified Geographical Area (GA) of the country. CGD sector has 4 different segments – Compressed Natural Gas (CNG) predominantly used as auto-fuel and Piped Natural Gas (PNG) used in in domestic, commercial and Industrial segments.
  • Regulations pertaining to authorization/bidding of City Gas Distribution (CGD) networks were amended in 2018. The revised regulatory framework helped in attracting wider participation from public and private sector in CGD sector and leading to expand the coverage of CGD to 228 GAs spread over 406 districts with potential to cover about 53% of the country’s area and 70% of country’s population. It will make available environment friendly fuel i.e. CNG/PNG to public at large.
  • To promote the development of CGD network, the Government has given the priority in domestic gas allocation to PNG (Domestic) and CNG (Transport) segments. It has been decided to meet 100% gas requirement of CNG (T) and PNG (D) segments through supply of domestic gas which is cheaper than imported gas. At present, CGD sector is consuming approx. 14.36 Million Metric Standard Cubic Meter per Day (MMSCMD) of domestic Gas for CNG (Transport) and PNG (Domestic) sector. There is approx. 10.91 MMSCMD of imported Re-gasified Liquefied Natural Gas (RLNG) used by Commercial and Industrial segment of CGD sector.

Market Dynamics:
 
 
 
Opportunities
  • Developing cross country pipeline network
  • Expanding pipeline network will help to fill the demand of natural gas across various sectors
  • To achieve the set target of govt. to make India gas-based economy & increase the share of natural gas from 6.2% to 15% in energy mix
  • Emerging city gas distribution (CGD) network & increase the utilization of CNG as fuels which will help to reduce the carbon emissions
  • Boost the growth of domestic gas fields comprising isolated and small fields
  • To meet the energy requirements of far-flung areas
  • Assistance in electricity grid stabilization during peak load demand with the help of gas-based power and increase the renewable energy development target of 175 GW by 2030
 
Market Trends 2020:
Indian virtual pipeline initiative
 
  • Virtual Pipelines- “The concept of Virtual Pipeline is based on the loading cylinders packed with natural gas onto specially designed trucks and carrying the gas between existing pipelines or to areas not connected to a natural gas distribution system, such as rural towns, and remote factories, universities and hospitals. These pipelines will help India to increase the utilization of natural gas & expand the share of gas in energy mix”
 
ExxonMobil, Indian Oil and Chart Industries to Pioneer Virtual Pipeline Initiative 
  • ExxonMobil India LNG Limited has signed a Letter of Cooperation with Indian Oil Corporation Limited and Chart Industries, Inc. to establish a system of transportation infrastructure to expand gas access in India.
  • Virtual pipeline systems deliver liquefied natural gas by road, rail and waterways to areas not connected by physical pipelines. This Letter of Cooperation brings together ExxonMobil, Indian Oil, India’s largest state-owned oil refining and marketing company, and Chart, a leading global manufacturer of LNG equipment for use throughout the liquid gas supply chain. The parties will implement a gas infrastructure initiative that leverages LNG ISO intermodal containers to move gas as a reliable, cleaner and cost-effective fuel.
  • The initiative seeks to develop a pilot project and create a roadmap for mobile gas infrastructure expansion at scale, improving access to an abundant and cleaner fuel source.
Way forward/ Infraline Views:
  • Mid-stream oil and gas industry is expected to witness momentous growth in coming years owing to government support & encouraging policy. Government push toward gas-based economy is accelerating the infrastructural growth of Pipelines.
  • Union budget of 2020-21 for petroleum & natural gas industry is focused on the growth of natural gas industry and proclaimed to increase the total length of natural gas pipeline to 27000Km from 16981Km in coming years.  Additionally, the transparent gas pricing for domestically produced natural gas will boost the demand & growth of pipelines in India. Emerging CGD business & environmental concerns fueling the growth of market. Technological advancements such as crack detection, GIS mapping, gyroscopic stabilization, GPS, camera miniaturization etc. are anticipated to drive the evolution of pipeline market in coming years.
  • Encouraging gas-based industries along the pipeline network.
  • Local government assistance to acquire RoU for project implementation.
  • Evolving a regional gas grid in other states on the lines of Gujarat, to enhancement the development of the national gas grid.
  • Streamlining of transmission tariffs for pipelines.
  • Progressing the idea of a gas trading hub to develop a natural gas market.
  • Stimulate LNG as an auto fuel in heavy vehicles and a bunker fuel in shipping.
  • Capital funding provision from the government to improve commercial viability of seemingly non-viable pipelines.

 

add comments

Name*

Email*

Your Comments

Recent Posts