New Delhi: India’s Minister of Petroleum and Natural Gas & Steel Dharmendra Pradhan, on Monday, launched the Indian Gas Exchange (IGX), the first nationwide online delivery-based gas trading platform for natural gas.
IGX is incorporated as a wholly-owned subsidiary of the IEX – India’s energy market platform. It will enable market participants to trade in standardized gas contracts.
It will enable foreign companies, including gas exporters in the Gulf, to sell directly to domestic customers here. Indian gas companies will also be allowed to do so. The platform is fully automated with a web-based interface to provide a seamless trading experience to the customers.
During the virtual launch ceremony, Mr. Pradhan said, “the launch of the new electronic trading platform for natural gas today will help the nation move towards free-market pricing of natural gas”.
India plans to increase by two and a half times the share of gas in its energy consumption pattern in 10 years. Currently, India’s daily consumption of gas is estimated to be approximately 165 million cubic meters.
Nearly half of this comes from imported liquefied natural gas, LNG, which makes the role of LNG-exporting countries and companies critical to the newly launched IGX.
Pradhan also said that Petroleum and Natural Gas Regulatory Board (PNGRB) is working on the rationalization of tariffs to make natural gas affordable in every part of the country.
Pradhan said the launch of IGX, as an electronic trading platform for natural gas, had opened a new chapter in the energy history of India to help the country move towards free-market pricing of natural gas.
IGX will play a bigger role in realizing a free market for gas, he added, as there will be a market-driven pricing mechanism.
“The government has no business to be in business and the consumer is the king in a free market,” the Oil minister added. He also said that through IGX, India’s vision on mega investments on Liquefied Natural Gas (LNG) terminals, gas pipelines, CGD infrastructure, and permission for market-driven price mechanism will be materialized.
He also promised to soon unveil a new gas tariff policy, nearly double India’s gas pipeline infrastructure and increase the annual LNG import capacity by 26 percent.
Referring to the various initiatives taken to make India a gas-based economy, the minister said that the “Indian gas market has multiple price bands for assets including pre-NELP, NELP, High Temperature and High Pressure (HTHP) and deepwater and ultra-deepwater blocks”.
He also mentioned about various ongoing projects to strengthen the gas infrastructure in India like Urja Ganga, Eastern India grid, Indradhanush project in the North-east, Dhamra-Dahej pipeline, coal gasification, and CBM policy. He ensured that country will have more than 30,000 km of pipeline in the next few years.
India will soon have 50 MMT LNG terminal capacities, he added. India has long-term gas contracts with many countries like Qatar, Australia, Russia, and the US, and has made investments abroad in strategic assets in Mozambique, Russia, and other countries.