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Natural Gas, touted as the clean fuel of 21st century, is fast emerging as a major energy source all over the world. Yet another fossil fuel and often found in oil fields and coal beds natural gas is estimated to contribute around 26% of global energy consumption by 2030.
Its consumption is expected to increase from 95 trillion cubic feet in 2003 to 182 trillion cubic feet in 2030.
Nearly three quarter of the total global natural gas reserves are located in the West Asian and Eurasia regions. Iran, Qatar and Russia together accounts for nearly 58% of global natural gas reserve.
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Electrical and industrial sectors are two leading consumers of natural gas in the world. Developed countries led by U.S. are major consumers of natural gas at present. However, China and India are fast emerging as key players in natural gas demand.
Demand for natural gas growing at rapid clip during the past decade is expected to gather further momentum due to high price of oil as well as environmental concerns.
Natural gas is commercially produced from oil fields and natural gas fields. Gas produced from oil wells is called casinghead gas or associated gas. The largest two natural gas fields are probably South Pars Gas Field in Iran and Urengoy gas field in Russia, with reserves on the order of 1013 m³. Qatar also has 25 trillion cubic meters of natural gas (5% of the world's proven supply), enough to last 250 years at current production levels.
In India, the main producers of natural gas are Oil & Natural Gas Corporation Ltd. (ONGC), Oil India Limited (OIL) and JVs of Tapti, Panna-Mukta and Ravva. Under the Production Sharing Contracts, private parties from some of the fields are also producing gas.
Government have also offered blocks under New Exploration Licensing Policy (NELP) to private and public sector companies with the right to market gas at market determined prices.
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Most of the production of gas comes from the Western offshore area. The on-shore fields in Assam, Andhra Pradesh and Gujarat States are other major producers of gas. Smaller quantities of gas are also produced in Tripura, Tamil Nadu and Rajasthan States.
Natural gas has been utilised in Assam and Gujarat since the sixties. There was a major increase in the production & utilisation of natural gas in the late seventies with the development of the Bombay High fields and again in the late eighties when the South Bassein field in the Western Offshore was brought to production.
Natural Gas is currently the source of half of the LPG produced in the country. LPG is now being extracted from gas at Duliajan in Assam, Bijaipur in M.P., Hazira and Vaghodia in Gujarat, Uran in Maharashtra, Pata in UP and Nagapattinam in Tamil Nadu.