Petronet LNG Ltd.

, India

INVESTMENT IN LNG TERMINALS & FUTURE FOR THE DOWNSTREAM INDUSTRIES

By: Rajender Singh, Director(Technical)

OVERVIEW
Global & Indias Energy Consumption Scenario

Downstream Consumers & Indias Gas import Position

India-A Major Gas/ LNG Consumer LNG Trade Typical LNG Terminal process LNG extended chain and PLL presence

PRIMARY ENERGY CONSUMPTION (MTOE) - WORLD

6% 1%
Year 2005 Oil Gas

Fuel Oil Gas

2005 3901 2501

% 37 24

2011 4059 2954

% 33

6%

36%
28%

Coal Nuclear Hydro

24

Coal
Nuclear Hydro Renewables Total

2982
627 662 84 10537

28
6 6 1 100

3724
599 791 195 12322

30
5

23%

Renewables Year 2011

5%
6

6% 2%

Oil Gas

33%
2

Coal
Nuclear Hydro

30%
100

24%
Source : BP Statistical Review-June 2012

Renewables

PRIMARY ENERGY CONSUMPTION (MTOE) - INDIA

1% 6% 1%
Year 2005 Oil

Fuel
Oil Gas Coal Nuclear Hydro Renewables Total

2005
120 32 184 4 22 2.0 364

%
33 9 51 1 6 1 100

2011
162 55 296 7 30 9.0 559

%
29 10 53 1 5

33% 50%

Gas Coal Nuclear

9%

Hydro Renewables

1% 5% 2% 29%

Year 2011 Oil Gas Coal

2 100

53%

10%

Nuclear Hydro

Source : BP Statistical Review-June 2012 Renewables

CURRENT GAS DEMAND & DOMESTIC SUPPLY SCENARIO

1000 900 800 700 600 500
(9.6) (10.9) (8.0) (8.8) (12.7) (15.7)

Demand
(MMSCMD) (Bcf/day)

Domestic Supply
(22.2)

(25.3)

713.5 625

442

358

400 300 200 100 0

307 272 211.79 111.26

(3.9)

227 101.1
(3.6)

248
102.5
(3.6)

231.42
(8.2)

120.63
(4.3)

156.7
(5.6)

172.2
(7.5) (6.1)

2012-13

2013-14

2014-15

2015-16

2016-17

2019-20

2026-27

2029-30

Source : Vision 2030, Natural Gas Infrastructure in India

Present Downstream Consumer -A Snap Shot

Gas Based Power Generation Feedstock Fertilizer Plants Petrochemicals Refineries City Gas Distribution Captive fuel for furnace/boiler/power in industries Transport Sector Natural Gas Driven heavy vehicles Light commercial vehicles Trains Barges/ Ships etc. CNG/ LCNG fuelling stations

SECTOR WISE PROJECTED GAS DEMAND

350 300 250 200 150 100 50 0 2012-13 2013-14 2014-15 2015-16 2016-17 2019-20 2026-27 Industrial Petchem/ Refineries / Internal Cons. Fertilizer City Gas

Gas Demand (MMSCMD)

Power

2012-13 Power Fertilizer City Gas 86.17 59.86 15.3

2013-14 103.94 59.96 16.22

2014-15 121.72 60.39 17.19

2015-16 139.49 72.09 18.22

2016-17 157.26 96.85 22.32

2019-20 202.26 105.65 35.94

2026-27 307.26 110.55 67.96

Industrial
Petchem/ Refineries / Internal Cons. Sponge/ Iron/ Steel Total

20.00
38.37 7.00 226.7

20.00
40.29 8.00 248.41

22.00
42.3 8.00 271.6

25.00
44.41 8.00 307.21

27.00
46.64 8.00 358.07

35.00
53.99 10.00 442.84

52.06
75.76 12.19 625.78

Source : Vision 2030, Natural Gas Infrastructure in India

INDIA A MAJOR GAS/LNG CONSUMER

13th largest gas consumer 70 BCM (~190 MMSCMD)

5th largest LNG importer 16 BCM (~44 MMSCMD)

Economy increasing at CAGR of 7-8% p.a. with similar increase in

Energy Consumption

Share of Natural Gas in Indian Energy basket to increase from 11% to

20% by 2025

Natural gas is environmentally friendly fuel and the consumption is

bound to increase for longer sustainability of any organization

INDIA Balancing Demand Supply GAP

Gas Production: Exploration/Developing of gas field in India PMT Field already declining KG Basin declining Coal Bed Methane-under development Import of Gas Cross Country Gas Pipeline: Many projects (TAPI, IPI, Myanmar-India

etc.) under discussion but long way to go LNG -Dahej, Hazira,Dhabol terminals operating -Kochi to be commissioned soon Development of Gas Infrastructure to make gas available to end consumers

INDIAS GAS INFRASTRUCTURE

Existing P/L Network : 11900 KMS (283 MMSCMD) Proposed additional P/L Network : 14000 KMS (540 MMSCMD) by 2016-17

Dahej LNG Terminal Hazira LNG Terminal Dabhol LNG Terminal

Gangavaram LNG Terminal

Kochi LNG Terminal

LNG Business
Current demand supply scenario in India makes for a good business

case for setting up LNG terminals

Even with all the announced terminals coming on stream in future.

Huge demand supply gap is expected going forward indicating scope for more LNG terminals
Huge

opportunity for unlocking the latent demand through infrastructure expansion given that natural gas is cheaper than feedstock for many industry sectors

Easy availability of capital through project financing LNG supplies are expected to increase by 2016-17 with many

Australian/US projects coming on stream. Further, the domestic gas prices are expected to go higher, thus brining down the gap between domestic gas price & imported gas price

LNG CHAIN
Liquefaction Loading

Transfer
Gas Field Storage Transport (Ballasted)

Transportation (Loaded)
Pumping

Unloading Transfer Storage

Vaporised LNG to Gas Consumers

Regasification

TYPICAL-LNG CHAIN COST

Internal Consumption

TYPICAL-LNG TERMINAL FLOW DIAGRAM

AIR HEATER STV-A/B FUEL GAS Metering STV-C

WS PUMP

CW / GW EXCHANGER HW / GW EXCHANGER

SCV HVAC

FOR BACKUP

BOG COMP.

HW PUMP

UNLOADING/ VAPOR RETURN ARMS

LP PUMP SHIP LNG TANK

RE C O N D E N S O R

HP PUMP

GTG

Extended LNG Chain

Container
Container

Petronets Initiatives to mitigate Demand Supply GAP and to encourage downstream industry in INDIA

DEVELOPMENT OF LNG SATELLITE TERMINAL

LNG Satellite terminal

NG NG NG

Power Plant
Industrial users Residential users

Small LNG vessels

LNG Trucks

LNG Trains

LNG Terminal

WORKING ON DEVELOPMENT OF LCNG STATION

PLL proposes to set up LCNG stations in India for supply of LNG &

CNG as a fuel in vehicles.

PLL also proposes to operate a few LNG buses for company and

public transportation as a pilot

Such LCNG Station/Hub can also be used for piped natural gas

in nearby area

Development of LNG TRANSPORTATION IN TRUCKS

LNG TRUCKS

DEVELOPMENT OF SATELLITE LNG HUB

Satellite Hub

VAPORISATION FACILITIES

WORKING ON DEVELOPMENT OF LNG TRANSPORTATION THROUGH SMALL SHIPS

WORKING ON DEVELOPMENT OF LNG TRANSPORTATION BY TRAIN

Train can also run on LNG (Example-CANADA)

WORKING ON DEVELOPMENT OF LNG TRANSPORTATION BY TRAIN

CONTD..

WORKING ON DEVELOPMENT OF LNG TRANSPORTATION BY AIRCRAFT

Recommendations
There exists very good potential for investment in LNG terminals in the

Country fuelled by the wide gap in demand supply

Investment in the downstream infrastructure also provides good

business potential

Conversion of existing liquid fuel user industries to natural gas offers

good returns

Indian EPCC contractors can collaborate with the internationally

renowned contractors to develop the LNG projects jointly and develop their capabilities locally

Thank You

www.petronetlng.com