Gas Supply Curtailment Impact
The government has decided to prioritize gas supply for household PNG and CNG, which may lead to curtailments for industrial users. Analysts from Nomura estimate that a 20% reduction in gas supply to industrial and commercial segments could impact Mahanagar Gas Limited (MGL) and Indraprastha Gas Limited (IGL) by approximately 3% each on their volumes.
Gujarat Gas Limited, which supplies around 49% of its total volume to industrial and commercial consumers, is expected to face a more significant impact of around 10% on its volumes due to this curtailment. In contrast, Mahanagar Gas has about 16% of its total gas distribution allocated to industrial and commercial segments, while Indraprastha Gas has around 13%.
The situation has also affected domestic LPG connections in Noida, where the minimum waiting period for booking a refill has increased to 25 days from 21 days. Noida currently has around 10 lakh LPG connections, and Ghaziabad has approximately 12 lakh. Notably, about 8,000 LPG connections in Noida and around 15,000 in Ghaziabad are classified as commercial.
Despite these challenges, the supply of PNG and CNG in the region has continued without interruption. The gas supply network in western Uttar Pradesh is connected to the Hazira-Vijaipur-Jagdishpur pipeline operated by GAIL (India) Limited, ensuring a steady supply for essential services.
Authorities have issued directions to ensure that domestic consumers do not face inconvenience in LPG supply, emphasizing the need to maintain household gas availability amid the curtailment for industrial users. The government’s decision to prioritize gas supply for essential segments may lead to a scarcity of gas for industrial and commercial use.
As the situation develops, observers are closely monitoring the impact on gas supply and the potential long-term effects on companies like IGL and MGL. Details remain unconfirmed regarding how these changes will affect overall gas distribution and consumer access in the coming weeks.
