The gas pipeline infrastructure which is being set up in the south could create a gas-based economy in the south. Delivering the theme address at a CII conference on natural gas here on Wednesday, Vinayak Chatterjee, chairman of New Delhi-based infrastructure services company Feedback Ventures India Private Limited, said here that the domestic natural gas industry was expected to drive investments of between $35 billion and $37 billion in the next five-seven years.
This would come on the back of the gas flowing from discoveries, development of transnational pipelines and growing transportation network, and creation of enabling policy environment to meet the demand-supply gap.
Andhra Pradesh will be the main beneficiary from pipeline and city gas distribution infrastructure, backed by the already-existing 835-kilometre regional network, and three pipelines which are under implementation and bidding. These pipelines are Kakinada-Haldia, Kakinada-Chennai and Mallavaram-Bhilwara.
“Further, the Andhra Pradesh Gas Infrastructure Corporation had recently submitted expressions of interest to the Petroleum and Natural Gas Regulatory Board (PNGRB) for development of two more gas pipelines — Kakinada to Srikakulam and Ennore to Nellore — and is readying for a third one Bangalore-to-Ananthapur, for PNGRB to initiate bidding.
These lines, when complete, are expected to create a vib-rant gas-based economy, by connecting almost all districts of the state to gas over the next three-four years,” said Vinayak Chatterjee, chairman of New Delhi-based infrastructure services company Feedback Ventures India Private Limited.
“However, given the high-growth trajectory that the country is in, there is expected to be a demand-supply imbalance, at least for the medium term. While the projected total gas demand is 262 mmscmd (million metric standard cubic metres per day) for 2011 and 311 mmscmd for 2017, the domestic supply projections stand at 125 mmscmd and 228 mmscmd respectively.
This is contrary to the total gas availability of 168 mmscmd in 2011 and 306 mmscmd in 2011,” he added.
The estimated investment potential of $37 billion, he said, might turn out to be just a tip of the iceberg, if the efforts made towards increasing the gas availability bear fruition. Of the 26 sedimentary basins in India, only 20 per cent of the total area has been ‘well explored’ so far.
Of the total 51 discoveries made so far, only two have started producing, with several other blocks holding potential. Besides, pricing decision is expected to take place by April 2011, while the gas sales and purchase agreement negotiations may begin by June 2011.
“While these important details like pricing and security concerns are being worked out, if and when the line does come up, not only will the supply situation be further boosted by 38 mmscmd in the medium-term, it will also connect India to a hugely gas-rich country for a long term,” Chatterjee said.
