Halving of LNG duty to save Rs 900 cr for consuming industries

Halving of LNG duty to save Rs 900 cr for consuming industries

The government’s move to halve import tax on liquefied natural gas (LNG) in a bid to promote use of the cleaner fuel, will result in Rs 900 crore savings to gas-consuming industries.

A host of industries from petrochemical plants to fertilizer units will benefit from the Budget announcement of cutting import duty on LNG to 2.5 pe cent from 5 per cent currently, Oil Ministry sources said

This, they said, augurs wells to achieving the objective of increasing the share of natural gas in India’s energy mix to 15 per cent by 2020 from 6.5 per cent at present.

Government is focused on increasing the usage of natural gas in overall primary energy mix for promoting a gas-based economy in the country. In view of limited availability of domestic gas, there is continuous increase in import of super-chilled natural gas (LNG) in the country.

Import of LNG is allowed under Open General Licence (OGL) scheme and prices are based on international market demand-supply scenario, they said, adding import duty of USD 0.35 per million British thermal unit on a spot LNG price of USD 7 per mmBtu will now halve. Read more…

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