GASTECH 2026: India's power sector likely to absorb more LNG as prices stabilize

India has no shortage of LNG demand, and the power sector offers significant potential to absorb additional volumes as prices stabilize and become more affordable, Petronet LNG Limited Managing Director and CEO Akshay Kumar Singh said Sept. 15 at an industry event.

India uses about 28% of its natural gas in the fertilizer sector and about 24% in city gas distribution, including piped natural gas and compressed natural gas, while the power sector accounts for only about 12%, Singh said at the Gastech 2026 conference in Bangkok.

The country has around 25 GW of installed gas-based power capacity, but many plants are not operating because of high gas prices, Singh said.

While some demand can be replaced by alternative fuel, some consumption stays "heavily dependent" on natural gas, according to Singh.

"We are not expecting LNG to replace renewable fuels, hydrogen, or coal. But definitely, from India's perspective, we are looking at liquid fuels," Singh said.

India remains heavily dependent on liquid fuel imports, with imports meeting almost 90% of demand. Replacing even a small share of liquid fuels with LNG would be beneficial from an environmental standpoint and could also be economical once global supply eases, Singh said.

India accounts for only about 6% of global energy consumption despite having 18% of the world's population, while natural gas makes up just 6% of its primary energy mix, compared with a global average of 24%, Singh said.

The government aims to raise gas's share to 15% over the next four to five years, a target that would require a three- to fourfold increase in gas consumption and sharply higher LNG imports, he said.

Currently, about half of India's gas demand is met through imports, and the other half is met through LNG imports, Singh said.

Achieving the 15% natural gas target could lift LNG imports to more than 100 million mt/year from about 25 million mt/year and raise LNG's share of the country's gas basket significantly, Singh said.

Petronet LNG currently operates two LNG terminals — Dahej on the west coast and Kochi on the southern coast, according to the company's website.

Petronet LNG has been expanding infrastructure to support this growth, including increasing the capacity of its Dahej LNG terminal to 22.5 million mt/year from 17.5 million mt/year earlier this year, Singh shared.

The company is also developing a 5 million mt/year LNG terminal on India's east coast, with scope for future expansion as demand grows, he said.

In August, Singh had shared that this land-based LNG terminal at Gopalpur was awaiting environmental clearance from the federal government.

According to Singh, these infrastructure investments would allow India to ramp up LNG consumption quickly when a reasonably priced supply becomes available.

Past trends have shown that consumption rises sharply amid stable prices, he continued.

Meanwhile, Singh also turned attention to India's approximate $65 billion investment program across the natural value chain, which includes LNG terminal facilities, transmission pipelines, distribution networks, and fuel-conversion infrastructure, to support future demand once LNG becomes more affordable.

The country currently has about 25,000 km of gas transmission pipelines, with another 10,000 km under development, and the expanded 35,000-km network is expected to improve grid connectivity across India and help serve its vast population, Singh noted.

Platts, part of S&P Global Energy, assessed the October JKM, the benchmark price for LNG cargoes delivered to Northeast Asia, at $28.945/MMBtu Sept. 15, down 2.66% from the previous close. It assessed the LNG West India Marker, or WIM, for October at $28.595/MMBtu on Sept. 15, at a discount of 35 cents/MMBtu to the October JKM assessment.