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NATURAL GAS SCENARIOS

GLOBAL & DOMESTIC
Rajeev Mathur
General Manager in-Charge (Marketing) Corporate Marketing Group GAIL (India) Limited, New Delhi

ENERGY ERAS

19th CENTURY - COAL

th 20

CENTURY - OIL

21ST CENTURY - GAS

2

ORGANISATION OF HYDROCARBON SECTOR

LPG ATF KEROSENE MOTOR GASOLINE DIESEL NAPHTHA Heavier fractions including Bitumen

REFINERY
IOCL/BPCL/HPCL/ RPL/OTHERS

END USER
EXPLORATION & PRODUCTION

ONGC OIL JVs

TRANSMISSION, DISTRIBUTION AND MARKETING GAIL/JVs/GSPL/AGCL

POWER FERTILIZER PETROCHEMICALS STEEL INDUSTRIES DOMESTIC CITY TRANSPORT

Gas Processing
LPG, PETROCHEMICALS

ONGC/GAIL/OIL/IPCL

GLOBAL & INDIAN ENERGY SCENARIO

World
Energy Consumption (MTOE) Energy Mix (%) Coal Oil Natural gas Nuclear Hydro Oil & Gas Imports (MTOE) -2006 Growth in Energy (10 yrs) Total Primary Energy Natural Gas 2.3% 2.7% 5.6% 9.4% 28.4% 35.8% 23.7% 5.8% 6.3% 3264 56.2% 28.4% 8.5% 0.9% 6.0% 119 10878 5th

India
423 Largest Energy Consumer

INDIA A FAST GROWING ENERGY MARKET

Source : BP Statistical Review of World Energy June 2007

PIPELINE VS. LNG TRADE - WORLD WIDE

Unit : BCM

600 500 400 300 200 100 0

532.65

537.06

549.67

188.81

211.08

226.41

2005

2006

2007 World LNG

World Pipeline

In 2007 total gas trade in the world was 776 bcm of which LNG share was 29%.
Source : BP Statistical Review

INDIAN : GAS CONSUMPTION

Unit : BCM

45 40 35 30 25 20 15 10 5 0

35.7

37.3

40.2

44

6.04

7.99

9.98

10.8

2005

2006

2007

2008

Consumption

LNG Import

In 2007 total gas consumption in India was 40.2 bcm out of which 24% (9.98 BCM) gas supply was met through LNG import only.
Source : BP Statistical Review

CONSUMPTION PATTERN - INDIA

2000 (22 BCM/ 60 MMSCMD)
1% 5% 4% 6% 6%

2007-8 (37 BCM/102 MMSCMD)

13% 3% 5% 5% 40%

38%

4%

40%

30%

Power Fertiliser

LPG+ Other Liquid HC Petrochem +Refineries

City Gas/CNG Steel

Others

POWER AND FERTILISER - ANCHOR MARKETS

INDUSTRIAL AND CITY GAS - GROWING MARKETS

CURRENT SCENARIO
[MMSCMD] Source ONGCL PMT JV RAVVA JV OIL RLNG (PLL) HLPL/CAIRN/ NIKOGSPC CRL RIL (KG-D6) Gas availability 49.0 17.3 1.95 5.80 23.40 9.47 DETAILS
HVJ & Ex-Hazira(25), Gujarat(4), Rajasthan(0.65), Uran(9.65), Cauvery(3), KG Basin(4.3), Assam(0.57), Tripura(1.43) Panna Mukta (5), Tapti(12) Ravva I-(0.80), Ravva Satellite(1.1) Oil Rajasthan(0.60), Oil Assam (5.2) PLL Dahej (18) + RGPPL(5.4) HLPL(5), Cairn Gujarat Blocks(2.5), NIKO-GSPC Gujarat Blocks(2)

0.08 28

CRL Assam Amguri Supplies likely to go upto 40 MMSCMD in FY 09-10

TOTAL

135

GAIL GAILS- EXISTING P/L INFRASTRUCTURE

PIPELINE DESIGN CAPACITY (MMSCMD) 33.4 23.9 19.5 23.6 12.0/12.0 15.99 8.66 2.26 2.5 153 Length(Kms) PRESENT AVG (MMSCMD) 29.5 22.0 3.5 11.0 4.0 6.5 2.90 1.43 0.70 82

HVJ/GREP DVPL GUJARAT & RAJASTHAN MUMBAI DUPL/DPPL KG BASIN CAUVERY BASIN TRIPURA ASSAM TOTAL

3100 650 1000 140 750 835 256 60 9 6800

LANDFALL PRICES - INDIA

Rs / MSCM APM PMT RAVVA RAVVA Satellite Pooled RLNG price RIL (ex Kakinada) Spot Min-Max 3520/7730 7730/9064,9324 5695 6996 8134 6700 16100-33330 $/MMBTU(NCV) 2.16/4.75 4.75/5.57,5.73 3.50 4.30 4.99 4.20 10.0-22.0

Prices are exclusive to Transportation Charges, Marketing Margin, Taxes, Duties etc. APM price includes royality. Exchange rate is taken @ 41.

GAS DEMAND OUTLOOK - PROJECTION XI PLAN

MMSCMD

Sector Fertilizers Power City Gas Industrial Petrochemical / Refineries / Internal Consumption Sponge Iron / Steel Total

2007-08 41.02 79.7 12.08 15

2008-09 42.89 91.2 12.93 16.05

2009-10 55.9 102.7 13.83 17.17

2010-11 76.26 114.2 14.8 18.38

2011-12 76.26 126.57 15.83 19.66

25.37 6 179.17

27.15 6.42 196.64

29.05 6.87 225.52

31.08 7.35 262.07

33.25 7.86 279.43

DEMAND ESTIMATE (2007-12) (2007140

Power
120

Industrial

Fertiliser
102.7

City Gas
114.2

126.6

100 79.7 MMSCM 80

91.2 79.4 79.4

53.1 60 46.4 40.8 40 12.9 20 12.1 13.8 14.8 48.6 42.7 52.2 56.8

60.8

15.8

0 2007-08 2008-09 2009-10 2010-11 2011-12

Total

179

197

226

262

279

As per XIth 5 Year Plan

CAGR Power 11 %, Fert-17%, City Gas-7%

INFRASTRUCTURE EXISTING & FUTURE

NANGAL BHATINDA DELHI

GURGAUN MATHANIA AGRA

BAREILLY AURAIYA LUCKNOW

JAGDISHPUR KANPUR

DISPUR PATNA

DAHEJ I & II 10 mmtpa*

BARMER GWALIOR

PHOOLPUR

RAJKOT

KOTA JHANSI UJJAIN VIJAYPUR

BHOPAL
AHMEDABAD

VARANASI

GAYA

AGARTALA

BOKARO KOLKATA

HAZIRA 2.5 mmtpa

LNG Existing Upcoming

BHARUCH

BARODA SURAT

CUTTACK

DAMRA BHUBANESHWAR
RAJAMUNDRY

MUMBAI

PUNE SOLAPUR

KRISHNAPATNAM KAKINADA

DABHOL 5 mmtpa

Transmission Pipelines
Existing GAILs Planned Pipeline RILs East West Pipeline RILs Planned Pipeline GSPCs Planned Pipeline

KOLHAPUR GOA

HYDERABAD

VIJAYAWADA NELLORE HASAN

BANGALORE

MANGALORE 2.5 mmtpa

MANGALORE

CHENNAI

ENNORE 2.5 mmtpa

City Gas/ CNG

KANJIKKOD
COIMBATORE

TIRUCHCHIRAPALLI

KOCHI 5 mmtpa

Existing Planned LNG Terminal

TUTICORIN

INTEGRATED GRID TO LINK ANY SOURCE TO ANY MARKET

GAS SUPPLY AUGMENTATION

Existing LNG Terminals Dahej (5 to 10 MMTPA) Hazira (2.5 MMTPA) Upcoming LNG Terminals Dhabol (5 MMTPA) Kochi (2.5 MMTPA) Cross Border Pipelines Iran-Pakistan-India TurkmenistanAfghanistan-PakistanIndia Coal Bed Methane 3.78 BCM (10 MMSCMD) of CBM is expected to be produced in the XIth plan.
TURKMENISTAN DAHEJ I & II 10 mmtpa* IRAN HAZIRA 2.5 mmtpa DAHEJ HAZIRA DABHOL DABHOL 5 mmtpa
NEW GAS DISCOVERIES LNG TERMs- Upcoming

KOCHI 2.5 mmtpa

LNG TERMs- Existing

KOCHI

TRANS NATIONAL P/L

NEW SIGNIFICANT DISCOVERIES

20

Discoveries / Year

16

Oil+Gas

12

Delhi

0
00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08

Rajasthan Basin Kolkotta

RJ-ON-90/1
Cairn(Barmer Block)

Mumbai CB-0S/2 (CAIRN) Gujarat Block

Mahanadi (RIL/ONGC) KG-DWN-98/3 (RIL)

CB-0NN-2000/2
(NIKO)Western Offshore

Source: DGH

GAIL GAS BUSINESS

Availability
ONGCL+OIL PMT RIL GSPC LNG Dahej LNG Dabhol* LNG Kochi LNG Dahej Spot Shell/Cairn/NELP Focus 56 15 60 0 28 10.5 0 5.4 15 (5/5/5) 1

GAILs Sourcing &Trading

ONGCL+OIL 51 9.8 10 0 17 10.5 0 1.8

2009
PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi PLL Spot

2010

Shell/Cairn/NELP Details 9 (2/2/5) Focus 1

Total

198.4

MMSCMD

Total

111.1

* Subject to 5 MMTPA LNG sourced at Dabhol by BD and Dabhol-Bangalore p/l being ready by 2009-10

Availability
ONGCL+OIL PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi LNG Dahej Spot Shell/Cairn/NELP Focus 82 15 80 54 36 18 9 5.4 20 (9/5/6) 5

GAILs Sourcing &Trading

ONGCL+OIL 76 9.8 10 5 19 10.5 9 1.8 10 (2/3/5) 5
DETAILS

2011

PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi PLL Spot

2012

Shell/Cairn/NELP Focus

Total

325

MMSCMD

Total

157.1

GAS MARKETERS-INDUSTRY SHARE MARKETERSONGC 1% OIL 5% SHELL 1% NIKO 4% CAIRN 3% IOC 7% BPCL 3% JV 6%

GAIL 49%

IOCL 6% RIL, GSPCL, PMT, JV,Pvt, etc 38% BPC 3% Shell 4%

GAIL 70%

2006

2010

Availability
ONGCL+OIL PMT RIL GSPC LNG Dahej LNG Dabhol * LNG Kochi LNG Dahej Spot Shell/Cairn/NELP Focus 56 15 60 0 28 18 0 5.4 15 (5/5/5) 1

MMSCMD

GAILs Transmission
ONGCL+OIL 51 11.3 45 0 28 10.5 0 5.4 9 (2/2/5) 1

2009
PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi PLL Spot

2010

Shell/Cairn/NELP Focus

Total

198.4

Total

161.2

* Subject to LNG Sourced by ISG group and Dabhol-Bangalore p/l being ready

Availability
ONGCL+OIL PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi PLL Spot Shell/Cairn/NELP Focus 82 15 80 54 36 18 9 5.4 18 (5/6/7) 5

MMSCMD

GAILs Transmission
ONGCL+OIL 76 11.3 65 10 36 10.5 9 5.4 11 (2/3/6) 5

2011

PMT RIL GSPC LNG Dahej LNG Dabhol LNG Kochi PLL Spot

2012

Shell/Cairn/NELP Focus

Total

315

Total

241.2

DEREGULATION - THE IMPENDING CHANGES

NATURAL GAS PRICES TO BE BROUGHT IN LINE WITH INTERNATIONAL FUEL OIL PARITY PRICES IN STEPS INTRODUCTION OF OPEN ACCESS PRINCIPLE FIXATION OF TRANSPORTATION TARIFF UNBUNDLING OF MARKETING AND TRANSPORTATION CATALYST FOR ATTRACTING INVESTMENT FOR INFRASTRUCTURE DEVELOPMENT

OPPORTUNITIES
Large gas finds from domestic sources like RIL/GSPC/ONGC High growth trajectory projected across sectors Core sectors aggressive on shifting to Natural Gas Emerging opportunities in City Gas & industrial clusters Acceptance of Market Driven Prices Connecting emerging Sources to Markets

CHALLENGES
As a Marketer Efforts to retain market share (% terms) in multiple marketer scenario Declining output from key ONGCL assets Producers preferring to market their own gas As a Transporter Capacity Utilisation of existing and new networks Timely creation of pipeline infrastructure by 2011-12 Ensuring sufficient rich gas for processing plants Depleting existing sources New Sources are lean

THANK YOU