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India will now seek to double its existing gas pipeline infrastructure of 15,000 km, as the Government seeks to provide a clean energy source to consumers.
Finance Minsiter Arun Jaitley announced that the usage of piped natural gas (PNG) would be rapidly scaled up.
“We have at present about 15,000 km of gas pipeline systems in the country. In order to complete the gas grid across the country, an additional 15,000 km of pipelines are required,” he said.
Jaitley said the Budget proposes to develop these pipelines using appropriate public-private-partnership models. “This will help increase the usage of gas, domestic as well as imported, which in the long-term will be beneficial in reducing dependence on any one energy source,” he added.
The Government also intends to accelerate production and exploration of coal bed methane reserves.
“The possibility of using modern technology to revive old or closed wells will also be explored to maximise production from such fields,” he said.
Petroleum and Natural Gas Minister, Dharmendra Pradhan, welcomed the announcements.
“The Budget has given a direction to the Petroleum and Natural Gas Minsitry. We are now on a mission mode to develop the gas grid,” he said.
He said a lot of investments will come in through the PPP mode. “Cities have to get PNG gas. There definitely should be more than one source of energy and we have to move towards being a gas based economy,” said Pradhan.
The industry also welcomed the announcements and expected more clarity in the coming days.
“In the coming days, we look forward a policy on CBM and PNG, as has been hinted by the government. India has good potential in CBM, which not only provides a cleaner energy option as compared to other fossil fuels, but also is import substitute,” said LK Gupta, Managing Director and Chief Executive Officer, Essar Oil.
“Announcing the doubling of gas pipeline is an indication that the Government is working on resolving the issues related to the supply side, which is a big positive. We hope that as a country we are quickly able to come to agreeable terms of all stakeholders so that our own natural resources are utilised, instead of being depended on expensive imports,” he added.
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