City Gas Distribution (CGD) Market in India (Both CNG & PNG) & Outlook 2022 - November 2018
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City Gas Distribution (CGD) Market in India (Both CNG & PNG) & Outlook – 2022 November 2018
Exhibit 01: Natural Gas Reserves in Asia , CGD Network Gas Consumption & Region Wise PNG Distribution in India
Percentage share of 10000.0 7.30%
APAC countries in Percentage share of APAC countries in
existing natural gas existing natural gas reserves for the world
8000.0 7.20%
reserves for that region
7.10%
In MMSCM
6000.0
Myanmar
7.00%
Rank:7 China
Proven Reserves: 0.5 tcm Rank:1 4000.0
India 6.90%
Rank:4 Proven Reserves: 3.8 tcm
Proven Reserves: 1.5tcm 2000.0 6.80%
0.0 6.70%
Vietnam
Rank:6 2017 2018 2019 2020
Proven Reserves: 0.6 tcm
0.64
1.28 Indonesia Region Wise PNG Distribution in India
Rank:3
3.8 Proven Reserves:
3.2
3.2 22.4 0.3
2.8 tcm 5.3% 20.7%
0.3 0.2
1.92
7.6 1.9
1.2 0.6
1.9
0.1 0.1
Delhi (NCR)
17.9 0.1
1.5 Maharashtra
24.3 2.1
0.8 Gujarat
9.6
Malaysia
Rank:5 46.1% ROI
Proven Reserves: 1.2 tcm
27.9%
Australia Bangladesh
Brunei China
India Indonesia
Malaysia Myanmmar
Pakistan Papua New Guinesa
Thailand Veitnam Australia
Other Asia Pacific Rank:2
Proven Reserves: 3.5 tcm
Source: enincon research & analysis, PPAC & Companies
© enincon consulting llp, 2018 Visit: https://enincon.comWhy enincon’s report upon “City Gas Distribution (CGD) Market in
India (Both CNG & PNG) & Outlook 2022”
174 DISTRICTS , 86 GEOGRAPHICAL AREAS ON OFFER, HUGE INVESTMENTS OF INR. 600 to 800 BILLION ON COURSE IN CGD MARKET OF
INDIA – STILL ONLY 20% OF THE COUNTRY IS COVERED UNDER CGD NEWTWORK
80% OF GEOGRAPHIC DISTRIBUTION OF INDIA YET TO COME UNDER CGD NETWORK, IMMENSE
OPPORTUNITY IN STORE FOR CGD BUSINESS IN THE COUNTRY BUT CHALLENGES DO NEED TO BE
ADDRESSED
India’s aim to evolve as a gas based economy has seen the Government taking initiatives to push upon multiple
facets to increase both the production and consumption of gas in the country. One such step is conducting
bidding rounds for City Gas Distribution (CGD), which for now has crossed its 9th milestone by completing 9
rounds so far. Among the rounds completed till date the magnitude, size and scale for 9th round was biggest with
78 Geographical Areas (GA) being allocated to successful bidders. Of the 86 GA on offer for the 9th round
concluded has seen allocations for 90% of them i.e. 78 GA . The interesting fact for the concluded round is that
of the total 19 companies allotted to work on the subsequent GA 3 are new entrants which opens up the area of
CGD business as there exists a massive potential expand it for both piped gas transportation and gas based
transportation. With smart cities coming into the fore with a enhanced rate the business case for CGD networks
will certainly get embellished and may be a preferred model for established OMCs and pipeline felicitator like
GAIL to engage on an integrator basis.
With loads of additional benefits for the participating bidders in the 9th round the flexibility is expected to extend
further in the upcoming bidding rounds in the country which further shall aid the necessary fillip to prosper the
fresh entries in the CGD business. To deem as highlight for the currently concluded round was that the winning
company will get eight years of marketing exclusivity, which can even be extended to nine years based on
certain criteria. This is an extension of erstwhile prevalent 5 years of exclusivity. Further, if we analyse the
current status of all the CGD rounds concluded the growth has been limited to western & northern part of the
country with 95% of the developments catered to these regions. Hence, there is an ardent need to expand the
CGD networks in the country specially to the eastern, central, southern regions and north-eastern regions.
© enincon consulting llp, 2018 Visit: https://enincon.comThe currently concluded 9th round had 174 districts under split of 156 complete and 18 in part, spread over 22 states and
UT’s. A total of 3,627 CNG stations shall be established under the aegis of current round with 15.3 million domestic PNG
connections is also envisaged. Hence, there was deep dive onto the CGD market built up in India was required potentially
to examine it as a growth market for a robust economic growth poised India. To top the deep dive a granular approach
was followed by our team of sector specialists and consultants to unearth the opportunities by GA in terms of industrial
units, demand centers, domestic density and major roads, highways and terminals. With integrated research approach
the opportunity which shall be emanating through the need for necessary infrastructure shall be of lucrative proposition
for the value chain players. Further, a market potential assessment shall also be conducted to determine the future
outlook for market participants and what shall change or govern the dynamics of the CGD business in the country. A clear
split of opportunities under transmission pipelines, city gas stations, CNG stations and finally the PNG network as per the
GA shall be outlined. Further, the dossier shall encompass with the changing regulatory dynamics and consumption
scenario coupled with a go/no-go feasibility and base line demand potential under 9th round.
Exhibit 02: Spread of Pipeline Network in India (KM) & Percentage Share for Different Transporters
12000 80.00%
11077
68.59% 70.00%
10000
60.00%
8000
50.00%
Length in KM
%age Share
6000 40.00%
30.00%
4000
2612 20.00%
16.17%
2000 1480
817 10.00%
9.16%
5.06% 140 0.87% 0.15%
24
0 0.00%
GAIL RGTIL GSPL AGCL/OIL/DNPL IOCL ONGC
Source: enincon research & analysis, PPAC & Companies
© enincon consulting llp, 2018 Visit: https://enincon.comExhibit 03: Spread of CNG Network Growth in India with CNG Station Share & Number of CNG Vehicles on State wise basis
500 40.00%
421
396
No. Of CNG Stations
400
30.00% 1.29% 5.33% Gujarat
300 245 0.19% Delhi (NCR)
35.96%
20.00%
Maharashtra
200 3.86%
AP/Telangana
72 10.00% 22.52%
100 42 54
3 Rajasthan
0 0.00% UP
RoI
30.85%
Source: enincon research & analysis, PPAC & Companies
BUSINESS CASE FOR CGD MARKET IN INDIA
• Gaining importance and competing against liquid fuel like petrol & diesel is becoming a brimming ground for expanding CGD networks
in the country
• CGD’s 9th Bidding round to increase presence in 174 districts with investment to the tune of INR.600-800 Billion
• Priority allocation of domestic gas to drive both volume and profitability. As per the policy, CGD (CNG and domestic PNG), fertilizer,
power and LPG customers are classified as Priority Sectors. This in turn is likely to boost CGD operators to aggressively acquire new
consumers without compromising margins from the incremental demand during the review period as the same demand was earlier
met by import
• CGD industry getting a regulatory push which has become key growth enabler. India’s Supreme Court banned the registration of
diesel vehicles with engine capacity of 2 liters or more in the Delhi, and ordered App based (Mobile) Taxies to convert their vehicles
into CNG.
• Geographical expansion to drive volume growth : The consistent addition of new geographies would not only likely to increase the
consumption of natural gas in India but would also likely to boost the volume growth and thereby drive profitability for CGD companies
in India.
• Auto Fuel Vision and Policy 2025 favoring the use of CNG vehicles
© enincon consulting llp, 2018 Visit: https://enincon.comREPORT INSIGHTS
• Present the natural gas scenario in India and the impact of changing dynamics on marked priority sectors
• Key market trends for CGD bidding rounds in India – All 9 rounds complete & exhaustive analysis
• Critical analysis of each bidding as per number of GA, bidders and time lapse in terms of award and announcement
• Opportunity analysis in terms of CGD pipeline, city gas station, CNG station and PNG network for all rounds post 5th
bidding round
• Regulatory and policy round up for CGD networks with detailed analysis on regulatory front for 9th bidding round
• Opportunity analysis for all 86 GA under 9th bidding round covering each geographical area, natural gas pipeline
proximity, for pipeline manufacturers, for OEMs, and for PMCs
• Complete assessment of Go/No-Go feasibility and baseline demand potential for areas under 9th round with insights
upon technical, financial limitations and intermittent challenges of gas sourcing with outlook
• Region wise outlook of CGD market in India covering all northern, western, eastern and southern regions in details with
focused approach for PNG and CNG networks
• Detailed competition benchmarking and profiling for market participants in CGD business of India
© enincon consulting llp, 2018 Visit: https://enincon.comKEY HIGHLIGHTS
• Opportunity for both domestic and foreign players under CGD market of India & outlook till 2022
• Opportunity for both domestic and foreign players under split of value chain services in CGD market of India & outlook
till 2022
• Best suited region for CGD business in India currently and for future market – Best fit regional analysis D2I Model feed
• Opportunity analysis in terms of CGD pipeline, city gas station, CNG station and PNG network for all rounds post 5th
bidding round
• Opportunity analysis for all 86 GA under 9th bidding round covering each geographical area, natural gas pipeline
proximity, for pipeline manufacturers, for OEMs, and for PMCs
• Complete assessment of Go/No-Go feasibility and baseline demand potential for areas under 9th round with insights
upon technical, financial limitations and intermittent challenges of gas sourcing with outlook
• Company Benchmarks for products, services, margins, financial performance for top Chemical Players in India
© enincon consulting llp, 2018 Visit: https://enincon.comPRESS EXCERPTS
“With the completion of the ninth bidding round, CGD will be available in 178 GAs comprising 280 districts (263 complete
and 17 in part) spread over 26 states and UTs, covering more than 50 per cent of India’s population”
Business Standard
“Our plan is to take the Gas Distribution Network across India starting from Punjab, Himachal Pradesh, Haryana,
Rajasthan, Maharashtra, Gujarat, Uttar Pradesh, Uttarakhand, Bihar, Jharkhand, Madhya Pradesh, Kerala, Karnataka,
Tamil Nadu, Pondicherry, Assam and Tripura – D K Sarraf, PNGRB
Economic Times
KEY QUERIES ADDRESSED
• What shall be in-store for India for CGD Market?
• What shall be scale of opportunity for both domestic and foreign players on GA basis in India for CGD business post 5th
round?
• What shall be the opportunity for both domestic and foreign players under gas transmission pipeline especially installed
for CGD business in India and its outlook?
• What shall be the opportunity for both domestic and foreign players for establishing city gas stations in India and its
outlook as per GA?
• What shall be the opportunity for both domestic and foreign players for establishing CNG stations in India and its
outlook as per GA?
• What shall be the opportunity for both domestic and foreign players for establishing PNG network in India and its
outlook as per GA?
• What shall be the opportunity for pipeline manufacturers, OEMs and Project Management Companies under CGD
business of India
• What shall be the key drivers and barriers to robust market growth?
• Which company shall lead the CGD business in India till 2022?
© enincon consulting llp, 2018 Visit: https://enincon.comMUST BUY FOR
• Industrial Gas Suppliers/Consumers
• Oil Marketing Companies
• Exploration & Production companies, FEED service providers and PMCs
• CGD network operators and strategic business entrants
• OEMs and pipeline infrastructure providers
• Fertilizer Manufacturers
• Automotive & Defense Sector
• Refineries & End User Segment
• Crude producing companies
• Feedstock companies
• Utility Solar Power Project Developers
• Government & Regulatory Bodies
• Research Institutions/Bodies
• Funding Bodies/Banks
COMPANIES MENTIONED
• Indraprastha Gas Limited (IGL)
• Gujarat Gas Limited (GGL)
• Mahanagar Gas Limited (MGL)
• GAIL Gas Limited
• Adani Gas Limited
• Maharashtra Natural Gas Limited (MNGL)
• ONGC Limited
• OIL Limited
• BPCL
• Essar Oil & Gas
• Central U.P. Gas Limited (CUGL)
• Bhagyanagar Gas Limited (BGL)
• Green Gas Limited
© enincon consulting llp, 2018 Visit: https://enincon.comContact – Head Office Contact – NCR Office
Address : 4th Floor, Worldmark 2, Address : 712, 7th Floor, I-Thum
Aerocity, Near IGI Airport, Towers, Noida, NCR Region,
New Delhi, India Uttar Pradesh, India
Phone: +91 11 2872 4511 Phone 1: +91 120 4157 000
Fax No. : +91 11 4178 7399 Phone 2: +91 120 4155 021
THANK
YOU!
Happiness does not come from doing easy
work but from the afterglow of satisfaction
that comes after the achievement of a
difficult task that demanded our best
- Theodore Isaac Rubin
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