Transcript India

India – A Driver for Asian
LP Gas Demand Growth
Alok Kumar Gupta
Chief Manager – Business Development
Hindustan Petroleum Corporation Limited
Overview of the Presentation
• LPG Market in Asia
• Current LPG Supply & Demand
• LPG Demand Drivers in India
• LPG Demand Outlook
• Replicating demand drivers
LPG Market Development in Asia
• Asia Pacific contribution to World LPG consumption
is:
• 40% in domestic sector
• 49% in industrial sector
• Rise in LPG demand from the domestic sector in the
•
•
•
•
Middle East and Asia
Bottled LPG remains the most widely used method
Demand rising from the transport sector (autogas) in
Asia-Pacific
LPG is fast replacing wood and dung resulting in
reduction of adverse climate effects
Rise in Population and change in lifestyle - provides
a significant opportunity for LPG
India & China are amongst Top 10 Producers & Consumers of LP Gas in World
Overview of the Presentation
• LPG Market in Asia
• Current LPG Supply & Demand
• LPG Demand Drivers in India
• LPG Demand Outlook
• Replicating Demand Drivers
LPG Demand in Asia
• Strong growth in LPG demand
LP Gas Consumption- Million MT
in Asia & Middle East
• Asia is largest LPG consuming
region in the world and is
still expanding
• Asia is largest user of LPG for
residential
applications
&
Industrial
• Asia has the largest growth
potential in the end use
sector
Asia: Moderate Demand Growth in LPG to Continue through 2015
LPG Production in Asia
• LPG Production is increasing
in China & India
LP Gas Production- Million MT
• Regional
LPG supply has
already increased by nearly
10 MMTPA since 2000
• LPG supplies should increase
by another 9 MMPTA in Asia
by 2012 (average growth of
4%/year)
Rise in LPG Production in Asia- New refining Capacity
Current Scenario in India
Sources of Bulk LPG
Demand & Production
2004-09
IN MMT
14
12
10
8
6
4
2
0
10.0
7.7
10.1
8.4
7.6
11.8
11.3
10.5
8.9
9.3
2004-05 2005-06 2006-07 2007-08 2008-09
Demand
Production
Import Growth (TMT)
Source Countries
3000
2453
2500
2000
2217
1500
2583
2592
1981
1491
1000
500
865
0
2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
India is fourth largest consumer of LPG in the world
Overview of the Presentation
• LPG Market in Asia
• Current LPG Supply & Demand
• LPG Demand Drivers in India
• LPG Demand Outlook
• Replicating Demand Drivers
Demand Drivers in India
• Indian Economy
• GDP Growth
• Increase in Per Capita Income
• Focus on Infrastructure Development
• Social Environment
• Growth in Population
• Increase in Literacy
• Women Empowerment
• Focus on Rural India
• Penetration of LPG
• Vision 2015- MOP&NG
• Govt. Policies & Public Schemes
• Concerns & Regulation on Climate Change
• Transportation sector
• Industrial sector
Indian Economy
Gross Domestic Product
• Maintaining Growth in
spite of slowdown
Per Capita Income
• Highest ever growth in
2008-09 (14.4%)
• Per capita income in
2008-09: US$780
GDP Growth In India
Per Capita Income
Infrastructure
• Highways: Allocation for
NHDP raised 23%
• Focus on housing & basic
amenities to urban poor
Driving Demand for cleaner fuel i.e. L P Gas
Demand Drivers in India
• Indian Economy
• GDP Growth
• Increase in Per Capita Income
• Focus on Infrastructure Development
• Social Environment
• Growth in Population
• Increase in Literacy
• Women Empowerment
• Focus on Rural India
• Penetration of LPG
• Vision 2015- MOP&NG
• Govt. Policies & Public Schemes
• Concerns & Regulation on Climate Change
• Transportation sector
• Industrial sector
Social Environment
Population
• Second most populous country
•
Literacy Rate In India
with 1.6% annual growth
70% people live in rural areas
Literacy Rate
• Female literacy rate during the
period 1991-2001 increased by
14.87% (54.2%) against 11.72%
(75%) in male literacy
• Imparting functional literacy to females through National
Literacy Mission:
• Gender Equity and Women Empowerment
• Heightened Social Awareness
• Increased School Enrolment
• Household Savings and access to credit
• Health and Hygiene
Driving Demand: Awareness in females on Clean & Convenient fuel
Demand Drivers in India
• Indian Economy
• GDP Growth
• Increase in Per Capita Income
• Focus on Infrastructure Development
• Social Environment
• Growth in Population
• Increase in Literacy
• Women Empowerment
• Focus on Rural India
• Penetration of LPG
• Vision 2015- MOP&NG
• Govt. Policies & Public Schemes
• Concerns & Regulation on Climate Change
• Transportation sector
• Industrial sector
Penetration of LPG
Urban
Rural
Total
Population March 2009
in Million
326.2
838.8
1165
Households in Million
93.1
156
249
LPG connections as of
01.04.09 in Million
79.2
26.5
105.7
Penetration
85%
17%
42%
Per capita consumption
(Kg/year)
128
83
117
Huge Potential in rural areas- needs to be tapped
Vision 2015 & Govt. Policies
1. New LPG Connections:
• Increasing LPG customer population from 107 millions
to 160 millions by 2015
• Raise population coverage from 57% to 75%
2. Common LPG Kitchen:
• Opening up in all villages with population > 5000 as a
part of Corporate Social Responsibility (Rasoi Ghar)
Govt. Policies & Schemes
Measures-Focus on Rural Areas
• Direct subsidy to farmers
• Extension of Debt waiver
• Allocation under NREGA increased by 144% (NREGA-
National Rural Employment Guarantee Act)
Additional 4.0 MMT LPG demand in Domestic Segment by 2015
Demand Drivers in India
• Indian Economy
• GDP Growth
• Increase in Per Capita Income
• Focus on Infrastructure Development
• Social Environment
• Growth in Population
• Increase in Literacy
• Women Empowerment
• Focus on Rural India
• Penetration of LPG
• Vision 2015- MOP&NG
• Govt. Policies & Public Schemes
• Concerns & Regulation on Climate Change
• Transportation sector
• Industrial sector
Regulation on Climate Change
Transportation Sector
• Efficient and Cleaner Road Transport
• Euro IV Standards
• CNG for all public transport
• Auto LPG
Industrial Sector
• Sectoral Initiatives taken by Govt. of India to achieve
Kyoto Protocol objectives
• Reduction of gas-flaring, installation of waste heat recovery
systems, energy audits, etc.
• Energy conservation in industrial sector has been promoted in
steel, cement, paper, caustic soda, brick & aluminum sector.
• Stricter pollution control norms propagating use of efficient
fuels
Additional Demand of 1 MMT in industrial sector by 2015
Overview of the Presentation
• LPG Market in Asia
• Current LPG Supply & Demand
• LPG Demand Drivers in India
• LPG Demand Outlook
• Replicating Demand Drivers
LPG Demand Outlook-India
LPG Demand Projections
•XI plan – CAGR 4% (2007-12)
•XII plan – CAGR 5.8% (2012-17)
•Asia Pacific Databook I – CAGR
LPG Demand-Industry
6%
LPG Supply Outlook
• 2012-13 – Supply equals
projected demand
• Grassroot refineries at Paradip,
Bina & Bhatinda – 1740 TMTPA
Industry Demand at 2010
Domestic : 11.1 MMT
Industrial : 1.1 MMT
Industry Demand at 2015
Domestic : 13.5 MMT
Industrial : 2.3 MMT
Expected Demand by 2015: 15.9 MMT
Overview of the Presentation
• LPG Market in Asia
• Current LPG Supply & Demand
• LPG Demand Drivers in India
• LPG Demand Outlook
• Replicating Demand Drivers
Asia- Replicating Demand Drivers
Demand drivers can be
replicated in countries where:
• Human Development Index is
more or less similar
Infrastructure
Development
Regulation
on climate
changes
• GDP per unit of energy is
comparable to India
Demand
Drivers
Women
Empowerment
• %age of urban population is
comparable
• Per Household LP Gas
consumption in domestic sector
is low
Focus on
Rural Areas
Increase in
Literacy
Rasoi Ghar- An Unique Initiative
• A pioneer initiative by HPCL
for promoting use of LPG in
rural India
• Provides low cost cooking for
users with
• Nil initial investment
• Cook and Pay
• Reduce Deforestation
• Concept based on community
kitchen
• Increases awareness of LPG as
convenient fuel
• More than 1450 Rasoi Ghars
across India
• Approx. 18000 families getting
benefited
Results in villagers taking individual LPG connections