Home / Companies / News /  Shell’s Indian arm set to begin retail sales of LNG

The India unit of Royal Dutch Shell is planning to start retail sales of liquefied natural gas (LNG) in the country, a top company executive said. Last June, the Petroleum and Natural Gas Regulatory Board (PNGRB) opened up LNG retailing to all eligible entities, aiming to promote LNG as an alternative fuel for heavy vehicles, and reduce India’s dependence on imported oil.

“We have an aspiration to build a number of retail sites which will be able to dispense LNG," Ajay Shah, vice-president, Shell Energy Asia said in an interview. Shell already retails petrol and diesel in India.

Shah refused to mention the number of LNG sites planned, but said Shell is exploring partnerships with other entities and holders of LNG capacity to expand its reach. Infrastructure is currently a bottleneck in the country and it needs partnerships and willingness to take risks, Shah noted.

Shell is one of the few international oil companies operating in India. In addition to its presence across upstream, integrated gas, downstream and renewable energy in the country, Shell also operates the Shell Technology Centre Bengaluru (STCB), one of its three global hubs for technology, after Houston and Amsterdam.

According to Shell’s LNG Outlook 2021, Asia is expected to drive nearly 75% of demand for LNG by 2040 as domestic gas production declines and LNG substitutes higher-emission energy sources, tackling air quality concerns and meeting emissions targets.

Natural gas emits 45-55% less greenhouse gas and less than one-tenth of the air pollutants than coal when used to generate electricity.

After the pandemic, China and India led the recovery in demand for LNG. While India increased imports by 11% in 2020 as it took advantage of lower-priced LNG to supplement its domestic gas production, China increased its LNG imports by 7 million tonnes to 67 million tonnes, an 11% increase for the year.

Shah also sees trucked LNG as an attractive segment for Shell’s presence. Last month, the company launched the operation of its small-scale truck-loading unit at its LNG import terminal at Hazira in Gujarat.

The truck-loading unit will augment Shell’s natural gas supply offerings in India to include the supply of LNG via trucks.

“Today, there are no LNG trucks in India, but we anticipate it will grow. Like in China, a decade ago there were no LNG trucks but today there are 13 million tonnes of LNG being sold into transportation in China," added Shah.

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