LPG Market Prospects India | Liquefied Petroleum Gas | Economies

Indian LPG Market Prospects

Apurva Chandra Joint Secretary-Marketing MOP&NG Government of India

2010-Madrid World LPG Forum 2010-Madrid

Overview of Presentation
• Indian LPG Scenario • LPG Market Prospects
– Potential in Rural India-Domestic Sector – Industrial Sector – Transport Sector

• Stimulating Demand Through
– Vision 2015 of MOP&NG – Government Policies and Schemes

• LPG Demand Outlook • Way Forward

e 900  Million/ year) Steady Growth @ 8% p.a. in LPG  Consumption in India Top 5 Consumers-Domestic (2008) LPG Demand (TMT) & Growth .Indian LPG Scenario Fourth  largest  consumer  of  LPG  in the  world  after  USA.  China  &  Japan Third  largest  consumer  in  domestic  sector  in  the  world  after China & USA Major  market  of  LPG  is  Domestic Sector Home  Delivery  of  3  Million  LP  Gas  cylinders  per  day(i.

Indian LPG Scenario Gap  between  demand  &  supply  (indigenous production) • Demand in 2009‐10 stands at   12746 TMT • Indigenous Production in 09‐10  was 10323 TMT • Imports @22% of total LPG  Demand  • Indigenous LPG production through State Run. Private And  Fractionators Demand Vs Supply (TMT) Indigenous Production .

  World Consumption in Industrial Sector is almost  11% & in Transport is 9% High Growth Expected in Commercial/Industrial & Transport Sector .Indian LPG Scenario Consumption Pattern: Domestic Commercial Industrial Transport-Auto LPG Domestic  growth  is  8‐9%  but  overall  pie  has  reduced over the years Commercial  &  Industrial  Consumption  is  increasing .

Overview of Presentation • Indian LPG Scenario • LPG Market Prospects – Potential in Rural India-Domestic Sector – Industrial Sector – Transport Sector • Stimulating Demand Through – Vision 2015 of MOP&NG – Government Policies and Schemes • LPG Demand Outlook • Way Forward .

6% Total 1165 254 115.8 88% Rural 838.LPG Market Prospects LPG Penetration in Domestic Sector: Urban Population in Million Households in Million LPG Connections in Million Penetration of LPG 326.0 45% Potential Market: Domestic Segment in Rural Areas .2 95 83.8 159 31.2 19.

LPG Market Prospects Potential in Rural India: • • 72%  of  Indian  Population  lives  in  Rural areas Population 87%  of  villages  have  population  < 200 less than 2000 200 ‐ 499 500‐ 999 1000‐ 1999 2000‐ 5000 5000‐ 9999 >10000   Total Distribution of Villages in India Number of  Villages 114267 155123 159400 125758 69135 11618 3064 638365 % of Total 18% 24% 25% 20% 11% 2% 0% 100% Encouraging Facts about Rural Market: Target Market • • • • Increase in Purchasing Power Improving Literacy Levels Imparting  Functional  Literacy  to  females Awareness about clean fuel LPG can make significant contribution in protecting Environment & Human Health .

LPG Market Prospects Industrial Sector: • Commercial  &  Industrial  Segment  growing  at  27%  CAGR  for last 5 years Achieving Growth through: – Conversions from conventional fuels  to LPG Commercial & Industrial LPG Sales • – Creating  Awareness  about  LPG  as  cleaner fuel – Capital Investments in Industries for  LPG Installations .

 India has per vehicle consumption  of 451 Kg per annum against world average of 1428 kg per annum.  .5 Million vehicles running on Auto Gas.LPG Market Prospects Transport Sector: Transport-Auto LPG Consumption per Vehicle: Kg/annum Source: WLPGA 2009 • Auto LPG sales increasing by 30% CAGR between 2005‐06 and 2009‐10  • With 0.

Overview of Presentation • Indian LPG Scenario • LPG Market Prospects – Potential in Rural India-Domestic Sector – Industrial Sector – Transport Sector • Stimulating Demand Through – Vision 2015 of MOP&NG – Government Policies and Schemes • LPG Demand Outlook • Way Forward .

 of India 1.  • Increasing LPG customer from 107 millions to 160  millions by 2015 • Switch Over from Kerosene to LPG 2.Stimulating Demand in Domestic Sector Vision 2015 of Govt. Common LPG Kitchen‐Making LPG affordable: • Opening up community Kitchens in all villages with  population > 5000 as a part of Corporate Social  Responsibility Projected Growth in LPG Demand shall be 8-9% year on year till 2015 . Increase in Domestic LPG Connections: • Focus on areas where LPG penetration is low by giving  incentives ‐ Raise population coverage from 50% to  75%.

 of India 3. Rajiv Gandhi Gramin LPG Vitaran (Low Cost Rural Distribution Model): • • Shall improve reach of LPG  A low cost model of distribution  sustainable for cluster of villages  having about 4500 families • Expected Refill Sales: 600 cylinders  of 14.2 kg  per month LPG Sales Volume in Domestic Sector shall reach 16MMT by 2015 .Stimulating Demand in Domestic Sector Vision 2015 of Govt.

Stimulating Demand Through Government of India Policies  Focus on Rural Areas to increase purchasing power of rural folks • Direct subsidy to farmers • Extension of Debt waiver  • Allocation  under  NREGA  increased  (NREGA‐National  Rural  Employment Guarantee Act) Automotive Sector: Efficient and Cleaner Road Transport • Euro IV Standards • CNG for all public transport • Auto  LPG:  Encouraging  consumers  to  switch  from  conventional  fuels to clean alternatives such as LPG Industrial Sector • Sectoral Initiatives  taken  by  Govt.  of  India  and  OMCs for  Conversion to LPG from liquid Fuels • Stricter pollution control norms propagating use of efficient fuels .

Overview of Presentation • Indian LPG Scenario • LPG Market Prospects – Potential in Rural India – Transport Sector – Industrial Sector • Stimulating Demand Through – Vision 2015 of MOP&NG – Government Policies and Schemes • LPG Demand Outlook • Way Forward .

9% 7033 2112 2000 2000 13145 4273 2014-15 18680 7.LPG Demand Outlook  2011-12 LPG Demand Projected growth Refineries Fractionators RIL Essar Total Prodn.1% 6903 2112 2000 800 11815 4325 2013-14 17418 7.3% 7513 2112 2000 2000 13625 5055 All Figures in TMT  Indigenous production . Import Required 14920 8% 5963 2112 2500 800 11375 3545 2012-13 16140 8.

Overview of Presentation • Indian LPG Scenario • LPG Market Prospects – Potential in Rural India – Industrial Sector – Transport Sector • Stimulating Demand Through – Vision 2015 of MOP&NG – Government Policies and Schemes • LPG Demand Outlook • Way Forward .

Infrastructure Plan S.No Infrastructure Capacity in TMT 2009-10 2014-15 6500 Project Investment USD Million 220 532 1 2 3 4 Import Handling Terminals Pipelines Capacity Tankage (Storage Capacity) Bottling Capacity 4700 685 12097 912 18037 700 450 .

Focus on Infrastructure Jalandhar Bhatinda Panipat Gurgaon Ajmer Delhi Loni Kanpur Guwahati Existing Pipelines Proposed Pipelines Existing Refinery Proposed Refinery Kandla Jamnagar Hazira Mumbai High Bina Barauni Durgapur Haldia Mumbai Secunderabad Chakan Paradip PROPOSED PIPELINES Proposed Pipelines Length NEW IMPORT TERMINALS Cost  USD LOCATION Capacity Cost USD Paradip – Haldia – Budge  673 km 202 M Ennore 600 TMTPA 90 M Budge – Kalyani – Durgapur Ennore – Chenglepet – 600 TMTPA 382 km 70 M 115 M JNPT Pondy – Trichy Kochi 600 TMTPA 60 m Mangalore – Bangalore 376 km 110 M Mumbai ‐ Uran – Chakan 166 km 105 M JNPT Mangalore Vizag Vijayawada Bangalore Chennai Ennore Kochi Trichy .

New Initiatives Commissioned  World’s  Largest  Flex  Speed Carousel at one of bottling plants  of State‐owned company (HPCL) Use  of  Anti  Pilferage  Device  in  LPG  Cylinders Integration  of  LPG  &  SKO  distribution  with  Govt.  of  India’s  Unique  Identification Project (UIDAI) IVRS/SMS  based  Refill  Booking  System  for LPG Customers EOI for Composite Cylinders Exploring  possibilities  of  Earning  Carbon  Credits Project Aadhaar‐ UIDAI Anti Pilferage Device .

Audio Visual (AV)  on Vision 2015 and Initiatives taken by OMCs .

Thank You .

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