What Happened
- South Asia has approximately 110.7 million tonnes per annum (MTPA) of LNG import capacity in development, representing about 17% of the global total in the pipeline.
- India leads this expansion with 84.6 MTPA of planned LNG import capacity, while Pakistan (12.1 MTPA) and Bangladesh (11.3 MTPA) are planning to roughly double their current import capacity.
- The region has $107 billion worth of planned LNG terminals and gas pipelines under development.
- India alone is developing 19,635 km of new gas pipelines — the third-largest pipeline expansion globally — to link LNG terminals with power plants, industries, and city gas networks.
- India's goal is to raise the share of natural gas in its energy mix to 15% of total energy consumption, up from approximately 6.2% currently.
- Global LNG export capacity is expected to grow by approximately 56% by 2031, driven by new projects from the U.S. and Qatar, potentially easing prices after a tight market period.
Static Topic Bridges
Liquefied Natural Gas (LNG): Process and Infrastructure
Liquefied Natural Gas is natural gas (predominantly methane) cooled to approximately -162°C at which point it liquefies, reducing volume by about 600 times for storage and shipping. It is re-gasified at import terminals for distribution. The LNG supply chain involves: gas fields → liquefaction plants (LNG export terminals) → LNG tankers → floating storage and regasification units (FSRUs) or onshore regasification terminals → national gas pipelines → end consumers.
- India's current LNG regasification capacity: approximately 42 MTPA (as of 2024).
- India's projected LNG demand by 2030: approximately 70 MTPA.
- India's LNG import terminals: Dahej, Hazira, Kochi, Dabhol, Ennore, Mundra (Adani), Jafrabad.
- Top global LNG exporters: Australia, Qatar, USA (post-2016 shale revolution), Russia.
- LNG pricing mechanisms: oil-linked (JCC formula) or Henry Hub-linked (U.S. contracts) or spot market.
Connection to this news: India's planned 84.6 MTPA expansion dwarfs current capacity of 42 MTPA — a more than doubling that reflects both growing industrial demand and the government's 15% gas target, contingent on affordable LNG prices.
India's Natural Gas Sector and the 15% Target
India aims to triple natural gas's share in the energy mix from approximately 6.2% to 15% by 2030. This target is driven by the need to reduce coal dependency, cut air pollution (gas burns cleaner), and provide feedstock for fertilisers (urea from natural gas). Gas infrastructure includes the National Gas Grid (being expanded to 34,500 km), City Gas Distribution (CGD) networks across 295 Geographical Areas, and PNG connections for households.
- Gas share in India's energy mix fell from 11% (FY2011) to approximately 6.2% (2024) — a declining trend despite targets.
- Major domestic gas producers: ONGC, Oil India, RIL-BP (KG-D6 field).
- Key LNG importing companies: GAIL, IOC, BPCL, Petronet LNG.
- India's gas demand projected to rise 60% between 2023 and 2030 (IEA estimate).
- Fertiliser sector is the largest gas consumer; power and CGD are next.
Connection to this news: The 110 MTPA South Asia LNG expansion is the physical infrastructure bet on achieving the 15% target — but historically, South Asian countries have cancelled 2–3 times more LNG capacity than they have built, reflecting the competition from cheaper coal and renewables.
Geopolitical Risks: LNG Supply Chains and Energy Security
The West Asia conflict (2026) demonstrated South Asia's vulnerability — India sourced over 55% of its LPG and about 30% of LNG through the Strait of Hormuz. LNG supply security also depends on stable relations with Qatar (India's largest LNG supplier) and Australia. U.S. LNG exports (post-2016) have introduced a new geography of supply that is Hormuz-independent, reducing concentration risk.
- Qatar: world's largest LNG exporter, supplies approximately 40% of India's LNG imports.
- The Strait of Hormuz disruption in 2026 exposed the concentration risk in India's energy supply chain.
- India-USA LTPA (Long-Term Purchase Agreements): discussions ongoing for U.S. LNG to diversify away from Middle East exposure.
- FSRUs (Floating Storage and Regasification Units) offer faster deployment than onshore terminals (2–3 years vs. 5–7 years).
Connection to this news: The 110 MTPA South Asian expansion is happening against a backdrop of active geopolitical risk from the West Asia conflict, which ironically may accelerate the case for diversified LNG supply sources.
Key Facts & Data
- South Asia planned LNG import capacity in development: 110.7 MTPA (17% of global pipeline).
- India's share: 84.6 MTPA; Pakistan: 12.1 MTPA; Bangladesh: 11.3 MTPA.
- Regional LNG/gas infrastructure investment: $107 billion.
- India's gas pipeline network in development: 19,635 km (3rd largest globally).
- India's natural gas share in energy mix: approximately 6.2% (target: 15% by 2030).
- India's current LNG regasification capacity: approximately 42 MTPA.
- Global LNG export capacity growth projected: 56% by 2031 (led by U.S. and Qatar).
- India is the world's third-largest oil importer, importing over 85% of crude oil requirements (~5.5 million barrels/day).
- Historical South Asia LNG track record: 2–3 times more capacity cancelled or shelved than built over the past decade.