& Gas Scenario Corporate Office, New Delhi 1 World & - - PowerPoint PPT Presentation

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Gas Business & Gas Scenario

Corporate Office, New Delhi

World & India Energy Overview

1990 2014 2030

3149 MMT 4211 MMT 1770 MTOE 3066 MTOE

World Energy Scenario: Golden Age for Gas

• BP World Energy Outlook - June 2015

1990-2014:

• Gas Share : Up 2%
• Oil share: Down 6%

2014 -2030 Outlook :

• Gas Share : Up 2%
• Oil share: Down 4%

By 2040, Oil and Coal collectively relinquish 9% of the global energy mix, with Renewables growing by 5 % and Gas and Nuclear each growing by 2%.

• IEA WEO 2015 Report - Nov. 2015

Share in Primary Energy Mix :

BRICS Nations – A Comparison

Year Brazil Russia India China South Africa 2004 102 2706 30 32 46 2006 109 2912 34 44 73 2008 130 2931 36 63 77 2010 137 2899 52 83 77 2012 159 2907 48 112 76 2014 196 2845 40 136 76

Source: BP Statistics 2015 & World Bank Population Data

Per Capita Natural Gas Consumption (Cubic Meter)

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92 MMTPA : Additional consumption required to reach China’s per capita Consumption

Indian Energy Scenario:

1990-2014:

• Gas Share : Up 1%
• Oil share: Down 4%

1990 2014

58 MMT 191 MMT 11 MTOE 46 MTOE

Share in Primary Energy Mix :

1990 2014 2037 Oil 58 191 467 Gas 11 46 167 Mtoe 2037

Source : BP Statistical Review of World Energy June 2015 & IESS 2047 – IEP Pathway

Indian Natural Gas Market

24.2 27.1 28.4 30.7 31.6 39.9 47.7 48.3 45.0 39.1 38.5 22.2 22.5 22.3 22.9 23.2 29.9 38.7 35.1 30.7 25.6 24.1 18.0 23.0 28.0 33.0 38.0 43.0 48.0 53.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Consumption Production

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Natural Natural Gas in Gas in India India

• Difference is being met through LNG Imports
• Gas Production downtrend is mainly due to RIL KG D6
• LNG couldn’t balance KGD6 fall due to high price and infrastructure constraints
• Availability & Infrastructure are the major constraints in India’s growth story.

Source: BP Statistics – June 2015

Values are in MMT

Source : MoPNG Annual Report 2014-15

Sector Wise Natural G Gas C Consumption: 2014-15 15 (H1)

(H1)

Major portion of NG is consumed by Power & Fertilizer Sectors, which are also priority sectors.

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Fertilisers 36% LPG extraction 4% Power 34% CGD 12% Steel 1% Petrochemi cals 3% Refineries 2% Others 8%

Fertilisers 34% LPG extraction 0% Power 8% CGD 17% Steel 3% Petrochemical s 4% Refineries 25% Others 9%

Domestic Gas RLNG

Sector Domestic RLNG Total

MMSCMD MMSCMD % Share

Fertilisers 26.77 15.05 41.82 35 LPG extraction 2.68 0.16 2.84 2 Power 25.37 3.43 28.8 24 CGD 9.07 7.45 16.52 14 Steel 1.16 1.46 2.62 2 Petrochemicals 1.93 1.79 3.72 3 Refineries 1.52 11.28 12.8 11 Others 6.29 3.93 10.22 9 74.79 44.55 119.34 100

NATURAL

NATURAL GAS MARKET GAS MARKET : IMPERATIVES IMPERATIVES

 Availability

• Domestic
• Imported - RLNG

 Spot/ Short/ Medium/ Long Term

 Gas Infrastructure

• Gas Pipelines
• LNG Terminals

 Affordability

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Gas Demand – Supply Overview

Sector Wise Gas Demand Projectio

ions s – India India

357 426 491 543 599

Source : CRISIL Report for IndianOIl - March 2014

MMSCMD 114 136 152 177 201 57 71 104 107 111 76 93 99 106 118 24 33 42 51 63 60 67 68 73 73 26 26 26 29 33 100 200 300 400 500 600 700 FY16 FY18 FY20 FY22 FY25 Petchem Refinery CGD Industry Fertilizer Power

Gas Demand Projections Vs Expected Domestic Gas & Import Capacity

Source : CRISIL Report for IndianOil – March 2014

126 132 138 158 149 104 132 167 177 177 30 30 357 426 491 543 599 100 200 300 400 500 600 700 FY16 FY18 FY20 FY22 FY25

Pipeline Imports Import Capacity Gas Supply Gas Demand

MMSCMD

Natural Gas Infrastructure in India

Gas Pipeline Density Km / 100 Sq Km.

5.57 1.39 0.51 0.48 0.00 1.00 2.00 3.00 4.00 5.00 6.00 U.S. Pakistan China India

Transmission Network Km per 100 Sq Km

Year : 2014. Data excludes Distribution Network

Existing

Transmission Pipelines

Existing – GAIL & GSPL Upcoming GAIL’s Planned Pipeline RIL’s East West Pipeline Pipelines awarded by PNGRB LNG Terminal

INTEGRATED GRID TO LINK ANY SOURCE TO ANY MARKET

JAGDISHPUR PHOOLPUR BHATINDA

BAREILLY DISPUR

DELHI AGARTALA BARODA LUCKNOW

PATNA

RAJKOT

KOTA

MATHANIA GWALIOR UJJAIN AGRA KOLKATA GAYA BOKARO JHANSI

DAHEJ 15 mmtpa HAZIRA 5 mmtpa

COIMBTORE

MUMBAI BHUBANESHWAR NELLORE CHENNAI TUTICORIN TIRUCHCHIRAPALLI HASAN

BANGLORE

KOLHAPUR

SOLAPUR

KAKINADA (MALLAVARAM)

DABHOL 5 mmtpa

KANJIKKOD

AURAIYA

GOA

CUTTACK VIJAYPUR

KANPUR NANGAL

GURGAUN PUNE

BHARUCH SURAT

HYDERABAD

RAJAMUNDRY

BHOPAL

KOCHI

5 mmtpa

BARMER

Natural Gas Pipelines – An Emerging Grid

BHILWARA

SRINAGAR jAMMU MEHSANA

PARADIP RAIPUR NAGPUR

JALGAON

Bidding stage

SRIKAKULAM

EOI stage

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Terminal 2016 2020 2030 Dahej 10.0 15.0 15.0 Hazira 5.0 5.0 10.0 Dabhol 2.0 5.0 5.0 Kochi 5.0 5.0 5.0 Mundra 5.0 7.5 Ennore 5.0 10.0 Jafrabad 5.0 10.0 Kakinada 6.5 6.5 Dhamra 5.0 Dighi 5.0 Gangavaram 5.0 Mangalore 5.0 22 51.5 89

Kochi Ennore Dabhol Hazira Dahej Mundra Dighi Kakinada Dhamra Mangalore

Operational Under Construction Proposed Under Planning

Indian LNG Terminals (Existing & Proposed)

Gangavaram

in MMTPA

Jafrabad

Gas Pricing & Affordability

GAS PRICING

 Domestic Gas

• Notified by GoI., Revised every 6 Months.
• Linked to weighted average of Global prices – Henry

Hub (HH), Alberta Hub (Canada), NBP UK & Russia Gas Price.

 Imported LNG

• Market determined
• Based on type of Contract
• Long Term / Short Term / Spot

Short Term/ Spot Price : DES 7 to 18 $/MMBTU Long Term (Crude linked): DES 7 to 15$/MMBTU (Crude 50 to 100 $/bbl) Long Term (Henry Hub linked ): DES 9 to 15 $/MMBTU (HH 3 to 8 $/mmbtu) Hybrid of Crude and Henry Hub Contracts available

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India LNG P

Prices:

$/MMBTU

Source: Spot & Short Term Prices are based on unweighted average of IndianOil Contracts

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Historic Historical al Prices Prices

Source: WoodMac LNG Tool and BP Statistics

$/MMBTU $/BBL

Tamil Nadu

Tamil Nadu

 One of the biggest and fastest growing state  Petroleum products consumption – 12.2 MMT (FY14)  Natural Gas consumption – 3 MMSCMD (~0.8 MMT)

2005 2010 2015(F) 2020(F) 2030(F) Rank in India by GDP 3 3 2 2 3 GDP Growth YoY (real) 14.2% 13.6% 9.4% 8.2% 7.3% Rank in India by Growth (Big States) 2 3 2 1 2 GDP Per capita (Mn$) 1007 1538 2101 3153 6103 Rank in India by GDP per Capita (Big States) 7 4 4 3 2 Rank in India by Population 7 7 7 8 9

Source : Wood Mac & MOPNG Statistics 2013-2014

Oil & Gas Consumption – Top 3 GDP states

State/UT Naphtha LPG Petrol/MS HSD LDO FO Gas Tamil Nadu 488 1583 1696 6195 5 729 800 Gujarat 5328 766 1205 4319 12 487 12100 Maharashtra 270 2164 2272 7347 92 964 5661 All India 10591 15925 17128 68287 386 5091 35300

In ‘000 Tonnes

Source : MOPNG Statistics 2013-2014

 Infrastructure is key for Gas Demand

 Gujarat currently has two LNG Terminals  Maharashtra has one LNG Terminal

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Demand – Supply

Year 2018-19 2023-24 2028-29 2032-33 Industries 13.6 21.2 24.3 24.5 CGD 0.6 5.7 8.9 11.5 Total Demand 14.2 26.9 33.2 36.0 Supply 3.0 3.0 3.0 3.0 Deficit to be met by LNG 11.2 23.9 30.2 33

Source : Mecon Market Study for IndianOil,. In areas along the proposed Pipeline. MMSCMD

Deficit (MMT) 3.1 6.6 8.4 9.2

Gas Grid – Tamil Nadu

KOCHI MANGALORE SALEM

PLL LNG Terminal IndianOil LNG Terminal IndianOil GAIL

Project LNG Import, Storage and Regasification Terminal Location Inside Kamarajar Port (formerly Ennore Port), Tamil Nadu. Capacity 5 MMTPA (with provision for expansion up to 10 MMTPA) Major Components: LNG Storage Tanks 2 Tanks, each of gross capacity 1,80,000 Cubic Meter Marine Jetty To handle LNG ships of sizes 65,000 Cubic Meter to 2,66,000 Cubic Meter. Pipeline Trestle

• Approx. 2.5 km from Marine Jetty to proposed Terminal.

Re-gasification Facilities Shell & Tube type vaporizers, LNG pumps, BOG compressors, Re-condenser, Metering & Gas send-out system, etc. Utilities Captive Power Plant, Nitrogen Plant, Instrument & Plant Air System, Fire-fighting Facilities, etc. Safety Systems Automatic Shutdown System in case of emergency, Fire Spill & Gas Detection, Alarm System, etc.

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Ennore LNG Terminal Project

Ennore - Tuticorin Pipeline

 On 10.12.2015 PNGRB has issued LOA for Ennore-Tuticorin Pipeline  Length of the Trunk Pipeline is about 1170 Km. Mainline sections

are as follows:

Ennore-Thiruvallur-Puducherry-Nagapattinum Thiruvallur-Bangalore Nagapattinum-Ramnathapuram-Tuticorin  Nagapattinum-Trichy-Madurai  Bid to award RoU survey have been received and likely to be

awarded in December 2015

 Connectivity to anchor customers will be provided based on the

requirement and entering into agreement. Space to be provided inside the premises for the gas supply station

 Pipeline Tariff is starting at Rs 6.40 /mmbtu

Path Forward

PATH FORWARD

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 IndianOil will have infrastructure to supply gas in Tamil

Nadu by 2018

 Ready to sign Long Term / Short Term Contracts on Crude /

Henry Hub / Hybrid linked Contracts

 Customers to Gear - Up

 Execute HoA (Heads of Agreement) which is a non-binding

agreement and contains broad areas which would be discussed and refined to formulate the GSA (Gas Sale Agreement).

 Discussion and firming up of GSA. The GSA is a document

executed by and binding on both parties.

 Changeover to Gas from Liquid Fuels.  Start Gas supplies.

CONCLUSION

 Natural Gas – Essential & Integral part of Energy Future  Robust Growth in last decade & expected to grow

further.

 Major contributor in India’s economic growth.  In absence of Domestic Gas, RLNG the only Solution.  IndianOil can supply RLNG to Tamil Nadu customers

with TES option.

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Thanks

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