India’s natural gas sector will see more market-friendly reforms which will help create a trading hub in the country, Oil Minister Dharmendra Pradhan told a gathering of investors at the 22nd World Petroleum Congress in Istanbul, Turkey.
“We are in the process of reforming the gas market in India where you can sell through a gas trading hub,” said Pradhan.
ET had reported on June 15 that the government was working on a plan to build a natural gas trading hub that could aid better price discovery for domestic as well as imported gas, and could eventually become Asia’s pricing hub competing with Singapore, Shanghai or Tokyo.
A market-driven pricing is considered necessary for the domestic market to mature, and a local trading platform could help. An electronic trading platform is expected to be ready by early 2018 which will allow only physical trading, according to people familiar with the plan.
Pradhan invited investors to the exploration and production sector, where a new policy allows companies the freedom to carve their own blocks, use just one licence to exploit all forms of hydrocarbons and the liberty to price their gas. “We have opened up 2.8 million sq km for your investment and I extend the commitment of the government of Prime Minister Modi that you will receive a red carpet welcome,” Pradhan said.
The rising middle class of emerging Asian countries like India will drive the demand for energy both in terms of electricity and cooking and transportation fuel, Pradhan said, adding that India is the only country where the demand will continue to rise for more than a decade.
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