Indian Gas Exchange launches small-scale LNG contracts
The Indian Gas Exchange (IGX) on April 24 announced the launch of small-scale LNG (ssLNG) contracts on its platform following approval from the downstream regulator, the Petroleum and Natural Gas Regulatory Board (PNGRB).
The introduction of ssLNG contracts on the IGX platform offers a flexible solution for procuring liquefied gas via LNG tankers under daily, fortnightly, and monthly contracts. Initially, these contracts are being launched at the Dahej and Hazira LNG terminals in Gujarat, with plans for expansion to other terminals including Dhamra, Mundra, Ennore, Kochi, and on-land ssLNG stations at Vijaipur.
“Small-scale LNG serves as the cornerstone for our gas-based economy, enabling us to expand our reach beyond traditional pipelines. On supply side, it can bring gas from remote and difficult fields and on demand side, it can help an industry source gas which is not connected to the gas grid,” Anjani Kumar Tiwari, Member, PNGRB said.
In India, natural gas is primarily supplied through pipelines. As a result, industries and commercial establishments without access to the grid rely on trucks for LNG transportation. The demand for road-transported LNG is projected to increase to 5mn m3/day over the next five years, according to IGX.
“With the demand for road-transported LNG projected to increase substantially over the coming years, our initiative will provide city gas distribution networks, industries and LNG dispensers a competitive gas pricing that will optimise their costs,” Rajesh K Mediratta, CEO, IGX said.
IGX was established three years ago and currently facilitates delivery-based trades across six different contract types, including day-ahead, daily, weekday, weekly, fortnightly, and monthly contracts, allowing trades to be executed for up to six consecutive months.