Centre's Push To Expand PNG Network As Iran War Raises LPG Supply Concerns

Amid energy security concerns stemming from the war in the Middle East, the Centre has launched measures to expand the Piped Natural Gas (PNG) network in the country.

The government has urged states and Union Territories to fast-track approvals for laying City Gas Distribution pipelines by waiving road restoration and permission charges and appointing nodal officers for swift rollout. The government is also urging domestic consumers to shift from LPG to PNG.

Commercial LPG consumers in urban areas are being encouraged to switch to PNG to reduce dependence on LPG supplies. Establishments such as hotels, restaurants, hospitals and hostels can obtain PNG connections from authorised City Gas Distribution entities. Service providers such as IGL, MGL, GAIL Gas and BPCL are offering incentives for domestic and commercial PNG connections.

Amid the war in the Middle East, Iran has blocked the Strait of Hormuz, the transit route for 20 per cent of global oil and gas supplies. This has led to supply concerns in India, which imports about 62 per cent of its LPG needs.

PNG vs LPG

While LPG cylinders are the most common cooking fuel in India, PNG or Piped Natural Gas is gradually becoming a popular alternative. PNG is supplied directly to our homes and businesses through gas pipelines. Government figures put India's PNG user base at around 1.59 crore households.

Commercial establishments in India are worried over the war's impact on LPG supplies, but PNG users are comparatively relaxed. A key reason for a stable PNG supply is domestic production. India's current natural gas consumption is about 189 Million Metric Standard Cubic Meters Per Day, and around 50 per cent is produced domestically.

Prashant Vasisht, senior vice president at the rating agency ICRA, has said the domestic production helps maintain supply stability. "Domestic gas supply provides a cushion. If more users shift to PNG, the system can handle demand more smoothly compared to LPG."

Also, senior officials at GAIL said, imported natural gas comes from several countries, including the United States, Russia, and Australia. This approach reduces reliance on any one region. This, however, does not mean PNG is completely insulated from global disruptions. India imports around 50 percent of its natural gas needs. So, if geopolitical tensions worsen or LNG supplies are interrupted, authorities may have to take strict measures. As for LPG, India imports about 62 per cent of its requirement and 90 per cent of these imports come through the Strait of Hormuz.