Small-scale LNG can be delivered at prices competitive with diesel and LPG used in industry, according to a study released on Tuesday by Council on Energy, Environment and Water (CEEW). Considering a one-way distance of 200 km and the average 2017-18 LNG import price, the study estimates the delivered price of natural gas to be $11.11 (₹815) per million British thermal unit (mmBtu) as compared to the average industrial prices of $24.04 per mmBtu for diesel and $16.62 per mmBtu for LPG.
Small-scale LNG systems transport liquefied natural gas from LNG import terminals in containers and re-gasify the fuel at consumer sites, instead of relying on transmission pipelines.
In this mode, LNG can commercially replace as many as 41 mmscmd of LPG and 144 mmscmd of diesel in industrial facilities in states within 600 km of an LNG terminal, the study says. “Small-scale LNG could bridge gaps in natural gas coverage by catering to consumers without pipeline connections or those unable to procure gas from city gas distributors at economical prices,” said Hemant Mallya, Senior Programme Lead, CEEW.
In locations currently served by city gas distributors, who enjoy infrastructure exclusivity and charge high prices, small-scale LNG can offer a cheaper alternative, according to the study.