Russia and India explore potential cooperation in using LNG as a motor fuel

October 3, 2020. Aiming to use natural gas as an environment friendly motor fuel for mutual benefit, the first ever India-Russia webinar on the use of natural gas as motor fuel was organized under the aegis of Ministry of Petroleum and Natural Gas, Government of India and the Ministry of Energy of the Russian Federation.

On the occasion, Tarun Kapoor, Secretary, Ministry of Petroleum & Natural Gas, Government of India informed that the Memorandum of Understanding between Ministry of Petroleum and Natural Gas, India and Ministry of Energy of the Russian Federation for cooperation on the use of Natural Gas for Transportation was signed in presence of Prime Minister of India, Narendra Modi and President of Russian Federation Vladimir Putin.

KPMG India and PWC India set the initial tone for the webinar by their presentations on CNG and LNG usage, policies and future prospects in the Indian markets. Besides, from Russia, there were presentations by Rostec, Kamaz Group and Natural Gas Vehicles Association speaking on the prospect of partnership for the CNG and LNG equipment manufacturing for the transport sector.

Indian speakers highlighted the growth potential of LNG and CNG as a transport fuel. It was mentioned that LNG is being promoted as a transport fuel because of its low carbon emission.

India is likely to have 120,000 LNG vehicles by 2030. By then, road transport is forecast to account for 1.2-3 million metric tons per annum (mmtpa) LNG demand, which is likely to go up to 4.5 mmtpa by 2035.

City Gas distribution network expansion is the backbone for CNG growth. Now CGD coverage is being expanded to over 400 districts across 27 states and Union Territories. There is a huge market potential in the CNG sector in India with expected investment of USD 3-4 billion in CNG equipment, USD 50-60 billion through CNG vehicles and USD 1-1.5 billion via service market till 2030.

Russian speaker from Rostec, which is having a significant share of Russia’s industrial assets, spoke at length about the technological and equipment aspects of LNG production and the supply chain. Speaker from Kamaz gave a comprehensive overview of the various LNG vehicles designed by the company and ready for use in Indian market.

Subsequently, speakers from Indian companies, namely GAIL (India) Limited and Indian Oil Corporation Limited, also made presentations about their experience in CNG and LNG as transport fuel in India.

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