Market Research Report : Natural Gas Market in India 2011


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The natural gas market in India is witnessing growth and capacity expansions to meet the growing demand for gas consumption as a result of growth in industrial, auto and commercial sector. Increased economic activity is providing the players an opportunity for growth and expansion.

The report provides a brief introduction to the natural gas industry. The market overview includes information regarding the Indian market scenario, market size and growth as well as the demand from various sectors in the coming years. It also highlights the various pricing mechanisms, price fluctuations, value chain and the major existing and proposed pipelines. The import section focuses upon the demand supply gap, imports made in last 5 years and the major countries of import.

An analysis of drivers explains growth factors such as increasing spend by the government, preference of industry for an alternate fuel, increase in gas reserves, deregulation of auto fuel prices, CNG is a cheaper fuel and new transmission tariff will generate more revenue. The key challenges identified include lack of exploration and low level of technology, gas flaring, lack of transport pipelines and a likely price increase. The role of the government has been highlighted and includes the major policies which govern the natural gas sector. The primary trends indentified include major investments in natural gas, emphasis on developing pipelines and development of city gas.

The competition section provides the market structure along with the brief profiles of the major players in the market along with their financials.

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Market Research Report : Natural Gas Market in India 2011

  1. 1. Natural Gas Market – India  Natural Gas Market IndiaJuly 2011
  2. 2. Executive Summary  Natural Gas market in India is poised to grow to M mn tns by 20‐‐, growing at a CAGR of x % Market   Both in the global and Indian context, the dependency on Natural Gas is growing Overview  In the domestic market, bulk of the production is from the ABC In the domestic market, bulk of the production is from the ABC Drivers Challenges  Increase in budgetary allocation  Lack of exploration & low level of technology Drivers &   Industry prefers green fuel Industry prefers green fuel  Gas flaring Gas flaringChallenges  Increase in gas reserves   Lack of transport pipelines  Deregulation of auto fuel prices  Likely price increase  CNG is a cheaper fuel  New transmission tariff Trends  The industry is witnessing major investments from both private and public players  Emphasis is being placed on the  on the development of pipelines  City Gas Distribution is coming in a big way so as to make LPG/CNG available to customers Major Players in the MarketCompetition Player 1 Pla er 1 Player 2 Pla er 2 Player 3 Pla er 3 Player 4 Pla er 4 NATURAL GAS MARKET IN INDIA 2011.PPT 2
  3. 3. •Introduction •Market Overview•Import p•Drivers and Challenges•Government Initiatives•Government Initiatives•Trends•Competition NATURAL GAS MARKET IN INDIA 2011.PPT 3
  4. 4. Natural gas market has been developing steadily with high  demand from power and fertilizer industry Natural Gas Market – Overview  Market Size and Growth • Indian energy market is growing at x % over the last two decades 1,000 x% C • In India, a % of the natural gas comes from region 1. 800 • India remains a natural gas deficit state so natural 600 B A gas has to be imported to meet growing needs 400 • Authority 1 and Authority 2 are the two major 200 authorities responsible f approval and execution of h ii ibl for l d i f 0 various projects pertaining to oil and natural gas 20‐ ‐ 20‐ ‐ 20‐ ‐  In general, Authority 1 provides a single window contact for all the activities in connection with carrying out work under M, or seeking clarifications or exemptions / Natural Gas Demand amendments Industry 1 Industry 3 Industry 5  Authority 2 is also the agency which monitors and Industry 2 Industry 4 Industry 6 regulates operations under PSC • Authority 2 is the approving authority for the issues 300 S f4% T f5 % requiring Government Approval 250 R f3 % f3 % e4 % e4 % e5 %  They are also the owners of the acreage, licensing f1 % Q f2% e3 % c4 % d4 % c5 % d5 % 200 P e2 % authority and deciding authority on accepting the bids e1 % c3 % d3% b5 % 150 d1% d2 % b4% b3 % 100 b1 % c1 % b2% c2 % 50 a3 % a4% a5 % a1 % a1 % a2 % 0 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐Source: NATURAL GAS MARKET IN INDIA 2011.PPT 4
  5. 5. Demand for natural gas outstrips domestic supply hence the  need for import Import Overview Import – Year wise • Currently, India does not have links via pipelines to Quantity Value foreign destinations and all imports are done through 10 X5 1.5 15 X3 X4 trucks containing LNG 8 X2 1.0 • Domestic supply of Natural Gas is A mn cubic metres 6 X1 X6 (mcm) per day but demand is B mcm per day 4 0.5 2 • Demand is expected to further increase to C mcm per p p 0 0.0 day by 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐ • Since demand outstrips the supply, India has signed an agreement with Country 1 to import D mn tons of LNG from Country 1 (long term contract) Major Importers (20‐ ‐) • Also, India has active LNG contracts with Country 1, x6 % Country 6 Country 2 and Country 3 x5 % Country 5 • The major trans‐national pipelines currently under x4 % Country 4 x3 % consideration are: Country 3 C t 3  Country 1 ‐ Country 2 Pipeline x2%  Country 2  Country 2 ‐ Country 3, Country 4 Pipeline Country 1 x1 %  Country 3 ‐ Country 5 PipelineSource: NATURAL GAS MARKET IN INDIA 2011.PPT 5
  6. 6. Drivers & Challenges – Summary  Drivers Challenges Ch ll Lack of exploration & low level of  Increased Budgetary allocation technology Preference of Industry for an alternate  Preference of Industry for an alternate Gas flaring G fl i fuel Increase in gas reserves Lack of transport pipelines Deregulation of auto fuel prices Likely price increase CNG is a cheaper fuel New transmission tariff will generate  ff ll more revenue NATURAL GAS MARKET IN INDIA 2011.PPT 6
  7. 7. Trends – Summary   Major investments in  Natural Gas  Natural Gas Key  Trends d Strong investment in city  Emphasis on the  gas development of pipelines d l f i li NATURAL GAS MARKET IN INDIA 2011.PPT 7
  8. 8. Major Players (1/7)Company Snapshot: Player 1Corporate Information Financial PerformanceHeadquarters Location 1 Location 1 Revenue Net IncomeFounded 19‐‐ 400 X4 50 300 X3 40 X2 X1Products  Product 1 & Product 2 200 30 20 100 10Key People Person 1‐ Position 1 0 0 20‐ ‐ 20‐ ‐ 20‐ ‐ 20‐ ‐Business HighlightsBusiness Highlights• Player 1 operates as a natural gas company both in India and Internationally• It is involved in exploration, production, processing, transmission , distribution and marketing of natural gas• Supplies natural gas to both households and industrial sector. Nationwide player 1 owns about K kms of pipe‐lines• Player 1 is bidding for a x % asset in US shale based company. The deal is approximately worth INR A  mn NATURAL GAS MARKET IN INDIA 2011.PPT 8
  9. 9. Thank you for the attentionThe Natural Gas – India report is part of Netscribes’ Power Industry Series. For more detailed information or customized research requirements please contact:Gaurav KumarPhone: +91 33 4064 6214E‐Mail: gaurav.kumar@netscribes.comResearch on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quick Research on India is a product of Netscribes (India) Pvt Ltd Research on India is dedicated to disseminating information and providing quickinsights on “hot” industries in India and other emerging markets. Track our new releases and major updates in these industries onAbout NetscribesNetscribes is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment &  g g f g p y p p fbusiness research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one‐stop shop designed to fulfil clients’ profitability and growth objectives.Disclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India, Disclaimer: This report is published for general information only Although high standards have been used the preparation Research on IndiaNetscribes (India) Pvt. Ltd. or “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes (India) Pvt. Ltd. and prior permission is required for guidelines on reproduction. NATURAL GAS MARKET IN INDIA 2011.PPT 9