India’s newest LNG import terminal, owned by Hindustan Petroleum Corporation Limited (HPCL), has received its first cargo of liquefied natural gas (LNG), HPCL officials confirmed to Bloomberg on Thursday.
The terminal, located in Gujarat on India’s west coast, is currently in the commissioning phase. The shipment is expected to be fully unloaded by January 16, according to the officials.
HPCL had initially planned to commission the terminal earlier but was delayed due to bad weather in April 2024. In October, sources told Reuters that HPCL aimed to complete commissioning in December or January and was negotiating long-term LNG supply contracts. The arrival of the first cargo marks a significant step forward in the terminal’s operational launch.
India is focused on increasing LNG imports as part of its efforts to replace coal with cleaner fuels, especially in industries where natural gas is vital. The country’s industrial sector is projected to drive a substantial rise in natural gas consumption in the coming years.
According to the U.S. Energy Information Administration (EIA), India’s gas demand is expected to grow significantly. The country’s consumption of natural gas could triple by 2050, driven by increased industrial activity, including oil refining to meet growing fuel demand. The EIA forecasts that India’s natural gas demand will grow at an annual rate of 4.4%, more than double the 2.0% growth expected in China, the next-fastest-growing gas consumer.
As the world’s third-largest crude oil importer, India is poised to become a major player in the global natural gas market. This growth will be fueled by rising demand from industries such as fertilizers, steelmaking, and construction, which are critical to the country’s booming economy and expanding population.
Despite increases in domestic production over the past two decades, India’s natural gas output will not be enough to meet the growing demand. The country will therefore rely heavily on LNG imports, as it lacks pipeline connections with major gas producers like Russia or the Gulf nations.
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