India's LNG import needs to double by 2030, IEA reports
The International Energy Agency (IEA) projected a significant increase in India's natural gas consumption, which is expected to rise by 60% from 2023 to 2030. This surge in demand will require the country to double its liquefied natural gas (LNG) imports, as domestic production is set to grow at a much slower pace.
India's rapid urbanization and industrialization are key drivers behind the transformation of its energy market, positioning it as a major force in global gas demand growth through the end of the decade and potentially beyond.
In the last two years, India has seen its natural gas demand increase by over 10%, following a decade of sluggish growth and occasional declines. By 2030, the IEA anticipates that India's gas demand will reach 103 billion cubic meters (bcm) annually. With additional government policy support, this demand could further rise to 120 bcm per year. Domestic production, on the other hand, is only expected to grow by 8% to approximately 38 bcm per year in the same timeframe.
As a result, India, which is currently the fourth-largest global buyer of LNG, will need to elevate its annual imports to about 65 bcm by 2030. This level aligns with the country's current import terminal capacity, which is approximately 48 million metric tons a year of LNG. This forecast outpaces expectations from Italian energy company Eni, which predicts India's LNG demand will double over the next 15 years.
The IEA underscored the importance for India to strategically plan its LNG procurement and expand import infrastructure to mitigate the risks associated with spot-market volatility.
With legacy contracts expiring, India could face a widening gap between contracted supply and projected demand after 2028, unless new long-term contracts are secured soon.
In response to growing demand, two Indian state refiners recently signed LNG purchase agreements with Abu Dhabi National Oil Co (ADNOC), and Indian oil companies are in discussions to procure U.S. LNG, capitalizing on increased output anticipated from policies enacted during President Donald Trump's administration.
India currently operates seven LNG import terminals with a combined capacity of around 47.7 million metric tons per year. To meet the projected rise in LNG requirements, additional import capacity will be necessary in the latter half of the decade.
Prime Minister Narendra Modi, in a virtual address to the India Energy Week conference in New Delhi on Monday, highlighted that major discoveries and new pipeline infrastructure have contributed to increasing the share of natural gas in India's energy mix. Modi aims to raise this share to 15% by 2030, up from the current 6.2%.
With its expanding demand, India has the potential to influence global LNG pricing, potentially challenging Europe's Title Transfer Facility (TTF) and Asia's Japan/Korea Marker as a significant market player, according to Cristian Signoretto, Eni's global gas & LNG director.
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