India to launch 11th city gas licensing round soon: Pradhan

Sep 11,2020

India will soon be launching a bid round to grant retail gas licences in cities to help expand green fuel coverage to about 500 towns, Oil Minister Dharmendra Pradhan said Thursday. Sector regulator PNGRB granted licences to retail CNG for automobiles between 2018 and 2019 and piped cooking gas to household kitchens in 136 geographic areas. This extended city gas network coverage to 406 districts and nearly 70 per cent of the country’s population.

"The 11th City Gas Distribution Round (CGD) will be launched very soon. PNGRB is planning for it," he said at a virtual event to commission 56 CNG stations in 13 states and one UT. "50-100 districts, particularly in Chhattisgarh, Madhya Pradesh and Vidharba, will join the city gas network after the 11th round."

The push for expansion of city gas is part of the government's plan to increase the share of natural gas in the country's energy basket from the existing 6.3 per cent to 15 per cent by 2030.

Pradhan said gas is cheaper, convenient and environmentally friendly and its increased usage would help to minimise reliance on imported oil.

The 11th bid round is planned around a new pipeline being installed between the east and west coasts from Angul in Odisha to Mumbai in Maharashtra to ferry natural gas. State-owned gas utility GAIL has begun work on the Angul-Mumbai pipeline, he said adding 17,000 km of gas pipelines are being constructed particularly in the eastern part of the country to link gas sources with consumption centres.

Also, to meet rising domestic demand, he said, the capacity of the liquefied natural gas (LNG) import terminals is being increased.

Pradhan said CNG-dispensing retail outlets rose from 938 in 2014 to 2307. "This figure will rise to 10,000 in 4-5 years" as companies carry out activities in all fields already licensed for.

Similarly, the number of households getting piped cooking gas is targeted to rise to 5 crores in coming years from the current 62.5 lakh, he said.

In eliminating the condition of Rs 2,000 crore investment in the hydrocarbon sector, the government has liberalized conditions for petrol and diesel retailing. Any company with a Rs 250 crore turnover can now set up petrol pumps and retail auto fuels, he said asking city gas entities to look beyond CNG and set up outlets that can retail not only gas but also petrol and diesel as well as charging electric vehicles (EVs).

The government is also pushing for use of LNG as a fuel in trucks and buses and 100 LNG pumps are planned to be set up on the Golden Quadrilateral connecting the four metros as well as on the North-South, East-West highway corridors and in mining blocks, he said.

In August 2019, Pradhan had stated that an investment of about Rs 1.2 lakh crore was to be made by 2030 in the rollout of city gas network in almost 300 districts for which licences have been given for the 9th and 10th bid rounds.

During 2018 and 2019, the Petroleum and Natural Gas Regulatory Board (PNGRB) awarded licences for setting up city gas distribution networks in 136 geographical areas.

While Rs 70,000 crore investment was committed to 86 geographical areas awarded in the 9th city gas bid round in August 2018, another Rs 50,000 crore was committed in the 50 geographical areas awarded in the 10th round in March 2019.

Less than 20 per cent of the population was covered by city gas distribution network in 2014 and after the award of the 10th bid round, this reached 70 per cent.

While 86 geographical areas, made up of 174 districts, were offered for bidding in the 9th round that concluded in August 2018, 50 geographical areas, comprising 124 districts, were offered in the 10th round.

With the completion of the 10th bidding Round, CGD would be available in 228 geographical areas comprising 406 districts spread over 27 states and Union Territories covering approximately 70 per cent of India's population and 53 per cent of its geographical area.

The 56 CNG stations commissioned on Thursday were set up mostly by Adani Gas and Indian Oil Corp (IOC).

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