India has instructed state-owned companies and private refiners to ramp up cooking gas production. This move comes as the ongoing conflict in Iran raises concerns over the security of the Strait of Hormuz, a crucial passage for approximately 90% of India’s liquefied petroleum gas imports. The government aims to enhance domestic gas supplies in response to the potential disruption of imports due to the war.
Government Mandates Increased LPG Production from Refineries
Refiners and crude oil explorers must now take all technically and economically feasible steps to boost LPG output, as mandated by a government notification issued on August 13. This directive aims to surpass current minimum production levels and includes initiatives like converting naphtha into LPG.
The government has set a target for the industry to produce up to 63,810 tons of LPG daily. Individual refiners have specific upper-limit targets, with Reliance Industries Ltd.’s domestic-focused unit receiving the highest at 18,000 tons per day.
Additionally, refiners are required to enhance their infrastructure for LPG storage, evacuation, and transportation. Companies must meet production increases within designated timelines, and the government will review these output targets biannually, in January and July.
