India will soon launch a bid round to give out licences for retailing gas in cities to help extend the coverage of environment-friendly fuel to about 500 cities, Oil Minister Dharmendra Pradhan said on Thursday.
During 2018 and 2019, sector regulator PNGRB gave out licences to retail CNG to automobiles and piped cooking gas to household kitchens in 136 geographical areas or GAs. This extended coverage of the city gas network to 406 districts and around 70 per cent of the country's population.
"The 11th city gas distribution (CGD) authorisation round will be launched very soon. PNGRB is preparing for it," he said at a virtual event organised to commission 56 CNG stations in 13 states and one UT. "50-100 districts, particularly in Chhattisgarh, Madhya Pradesh, and Vidharba, will join the city gas network after the 11th round." The push for city gas expansion is part of the government plan for raising the share of natural gas in the country's energy basket to 15 per cent by 2030 from the current 6.3 per cent.
Pradhan said gas is cheaper, convenient, and environment friendly and its greater use will help cut dependence on oil imports.
The 11th bid round is being planned around a new pipeline being constructed from Angul in Odisha to Mumbai in Maharashtra to ferry natural gas between the east and west coast.
State-owned gas utility GAIL has started work on the Angul-Mumbai pipeline, he said adding 17,000-km of gas pipelines particularly in the eastern part of the country are being built to connect gas sources with consumption centres.
Also, the capacity of liquefied natural gas (LNG) import terminals is being raised to meet rising domestic demand, he said.
Pradhan said retail outlets dispensing CNG have risen from 938 in 2014 to 2,307. "This number will rise to 10,000 in 4-5 years" after companies roll out operations in all the areas for which licences have already been given.
Similarly, the number of households getting piped cooking gas is targeted to rise to 5 crore in coming years from the current 62.5 lakh, he said.
The government, he said, has liberalised norms for petrol and diesel retailing by removing the condition of Rs 2,000 crore investment in the hydrocarbon sector.
Any entity with a turnover of Rs 250 crore can now set up petrol pumps and retail auto fuels, he said asking city gas entities to look beyond CNG and set up outlets that can retail not just gas but also petrol and diesel as well as charge electric vehicles (EVs).
"Don't get stuck at CNG station. Go for big retailing," he said.
The government is also pushing for use of LNG as a fuel in trucks and buses and 100 LNG pumps are planned to be set up on the Golden Quadrilateral connecting the four metros as well as on the North-South, East-West highway corridors and in mining blocks, he said.
In August 2019, Pradhan had stated that an investment of about Rs 1.2 lakh crore was to be made by 2030 in the rollout of city gas network in almost 300 districts for which licences have been given for the 9th and 10th bid rounds.
During 2018 and 2019, the Petroleum and Natural Gas Regulatory Board (PNGRB) awarded licences for setting up city gas distribution networks in 136 GAs.
While Rs 70,000 crore investment was committed in 86 GAs awarded in the 9th city gas bid round in August 2018, another Rs 50,000 crore was committed in the 50 GAs awarded in the 10th round in March 2019.
Less than 20 per cent of the population was covered by city gas distribution network in 2014 and after the award of the 10th bid round, this reached 70 per cent.
While 86 GAs, made up of 174 districts, were offered for bidding in the 9th round that concluded in August 2018, 50 GAs, comprising 124 districts, were offered in the 10th round.
With the completion of the 10th bidding round, CGD would be available in 228 GAs comprising 406 districts spread over 27 states and Union Territories covering approximately 70 per cent of India's population and 53 per cent of its geographical area.
The 56 CNG stations commissioned on Thursday were set up mostly by Adani Gas and Indian Oil Corp (IOC).