Despite of India's surging electricity demand, the economics of gas generation hinge on peak production, says Rajeev Mathur, executive director marketing at Gas Authority of India Ltd (GAIL). "If anyone wants reliable power [during hours of peak demand] he can pay more. That's where the economics of imported gas for power generation will work," he told Gas to Power Journal.
China will subsidise shale-gas production to help boost domestic gas supplies, earmarked to underpin plans of the Beijing government plans to expand share of gas in the nation's energy mix. Subsidies of 0.4 yuan (6.4 cents) per cubic meter of shale gas will be offered for shale gas developed and consumed between 2012 and 2015, according to China's ministry of finance.
Rising LNG imports to India, and government efforts to form a national gas grid, will help gas generation to expand beyond its present 10 percent market share. LNG imports can help to boost India's gas supplies, provided that Indian buyers are prepared to pay high prices for attracting cargoes in the tight Pacific Basin, an analyst with India's Central Power Research Institute (CPRI) told Gas to Power Journal.