Any Entity Can Set up LNG Stations: Indian Regulator

Indian downstream regulator Petroleum Natural Gas Regulatory Board (PNGRB) on June 2 said that any entity could set up an LNG filling station in any geographical area. PNGRB issued this clarification as there was a regulatory confusion over this issue.

The regulator said it had received communications from entities asking whether they could establish LNG filling stations and market the commodity or whether only the entity authorised to develop a particular city or local gas distribution network was able to do so. PNGRB said it had no powers to regulate setting up of LNG filling stations.

The regulator said that PNGRB Act "has extensively covered CNG stations and even the mode of granting authorisation to an entity that is desirous of establishing or operating a city gas distribution network which is essential for establishing or setting up a CNG station.”

“The Act has therefore laid down a regulatory framework for the CNG stations. However, the same is not provided for LNG stations,” PNGRB said.

This clarification by PNGRB has been welcomed by companies in the gas business. India’s biggest LNG importer, Petronet LNG, said the announcement would pave way for the creation of robust LNG infrastructure. “Petronet stands with all stakeholders who are willing to establish the LNG dispensing stations,” it said on Twitter on June 4.

Earlier this year, Petronet invited companies to bid for turnkey contracts to design, build and commission LNG/LCNG fuelling stations. Petronet wants to construct five stations on the major highways. The company has already launched its first commercially registered LNG buses and LNG dispensing stations at its Dahej and Kochi LNG import terminals.

Mumbai-based H-Energy said this clarification was a boon for its LNG retailing business. “This clarification will trigger a quick LNG stations establishment in India which will promote the replacement of diesel by LNG as transport fuel for commercial vehicles. It will not only result in reducing the vehicular pollution significantly but also reduce the cost of road transportation in the country," it said in a Facebook post published on June 4.

H-Energy is developing a floating LNG import terminal at Jaigarh in the state of Maharashtra. It is also planning a land-based receiving terminal in the eastern Indian state of West Bengal.

“Switching heavy-duty vehicles to LNG can help reduce emissions from the transport sector. This step by PNGRB is in line with the government’s policy to promote green fuels like LNG, and will promote the participation of more players across the value chain starting from OEMs and the fleet operators to the LNG dispensing infrastructure,” Ashwani Dudeja, country head – Shell Energy India told NGW via e-mail on June 5. 

Earlier this year, Indian cryogenic liquid storage, distribution, and regasification solutions provider Inox India signed a memorandum of understanding with Anglo-Dutch major Shell to develop a market for LNG supply by road from the Shell-operated Hazira terminal in the state of Gujarat. 

The Indian government and state-run gas companies have also been looking at LNG as an alternative transport fuel seriously. Earlier this year, Economic Times reported that India was planning a network of LNG fuelling stations along its 6,000-km long golden quadrilateral highways.