India plans to shift to a gas-based economy by boosting domestic production and buying cheap liquefied natural gas (LNG) as the world’s third-biggest oil importer seeks to curb its greenhouse emissions, oil minister Dharmendra Pradhan said.

New Delhi has promised to shave a third off its emissions rate by 2030, partly by boosting the use of cleaner burning fuels. Gradually we are shifting towards a sustainable gas economy,” Pradhan told Reuters in an interview.

India’s gas supply deficit is expected to widen from 78 million cubic metres a day (mscmd) this fiscal year to 117 mscmd in 2021-22, according to a government estimate.
“The price should be affordable to us. We respect long-term contracts but everybody has to appreciate the changing scenario,” said Pradhan. “In a bigger canvas … India has the potential of a huge market base”. Pradhan last month visited Saudi Arabia, the United Arab Emirates and Iran to deepen ties with its main oil suppliers.

India is also in talks with Abu Dhabi National Oil Co and Saudi Aramco to lease strategic oil storage. In the fiscal year to March, India’s gas production declined by about 4.2 percent, while imports rose around 15 percent.

India recently offered better gas pricing to boost domestic output, but its most recent investment in an LNG terminal in the southern state of Kerala has been underutilised since it lacks pipelines to connect to demand centres after farmer opposition caused land acquisition problems.

Pradhan said the government was talking to the states and hoped obstacles to a pipeline connecting Kochi to Mangalore would be resolved after state elections in Kerala.