Igl: Impact of Gas Supply Curtailment on and Other Companies
Gas Supply Prioritization Affects IGL and Others
The government has prioritized gas supply for household PNG and CNG, which may lead to curtailments for industrial users. Analysts at Nomura estimate that a 20% reduction in gas supply could impact Mahanagar Gas Limited (MGL) and Indraprastha Gas Limited (IGL) by approximately 3% on 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, with estimates suggesting a 10% reduction in volumes due to its higher exposure to these segments.
Mahanagar Gas Limited, on the other hand, distributes about 16% of its total gas to industrial and commercial segments, while Indraprastha Gas Limited allocates around 13% for similar purposes. This prioritization of household needs raises concerns about the future supply for industrial operations.
In Noida, the minimum waiting period for booking a domestic LPG cylinder refill has increased to 25 days, up from 21 days, affecting many households. Noida has around 10 lakh LPG connections, while Ghaziabad has 12 lakh, with a portion of these classified as commercial.
Approximately 8,000 LPG connections in Noida and around 15,000 in Ghaziabad are categorized as commercial, indicating a significant reliance on gas supply for business operations in these areas.
Despite the curtailment for industrial users, 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 some level of stability in supply.
Authorities have issued directions to mitigate inconvenience for domestic consumers regarding LPG supply, emphasizing the importance of maintaining access for households amid these changes.
As the situation develops, observers will be watching closely to see how these changes will affect the operational capacities of companies like IGL and MGL, as well as the overall gas supply landscape in India.
Details remain unconfirmed regarding the full extent of the impact on industrial users and how long these curtailments may last.
