Govt sets 63,810-tonne-a-day LPG production plan to guard against another supply shock

India has for the first time set refinery- and company-specific maximum LPG production levels, creating a framework that would allow the government to quickly ramp up domestic cooking-gas supplies during future disruptions.The move follows the West Asia conflict, which exposed India’s dependence on imported LPG and forced the government to take emergency measures to protect supplies to households.Under an August 13 order from the Ministry of Petroleum and Natural Gas, 21 refineries and upstream companies have been assigned a combined maximum production potential of 63,810 tonnes of LPG a day.That is equivalent to about 70% of India’s current daily LPG consumption and is significantly higher than the roughly 35,900 tonnes a day the country produced domestically in FY26.The specified production levels aren’t intended to operate as normal daily production requirements. Instead, they provide the government with a facility-wise framework for increasing output when domestic supplies come under pressure.Reliance’s Jamnagar refinery gets largest production levelReliance Industries’ domestic-tariff-area refinery at Jamnagar in Gujarat has been assigned the largest individual production level at up to 18,000 tonnes a day.The refinery has annual crude-processing capacity of about 33 million tonnes and supplies products to the domestic market. No target has been specified for Reliance’s separate 35.2-million-tonne export-oriented refinery at the same complex.Eighteen refineries operated by public-sector oil companies have collectively been assigned production of up to 31,470 tonnes a day.Nayara Energy’s 20-million-tonne-a-year Vadinar refinery has been assigned 4,480 tonnes a day, while upstream producers and gas processors including ONGC and GAIL have together been assigned 6,460 tonnes a day.Why India wants an LPG bufferIndia’s vulnerability became apparent during the recent disruption to energy supplies from West Asia.The country consumed 33.2 million tonnes of LPG in FY26, equivalent to roughly 91,000 tonnes a day. Domestic production amounted to 13.1 million tonnes, or about 35,900 tonnes a day, while imports accounted for about 21.3 million tonnes.That meant more than 60% of India’s LPG requirements were met through imports.The disruption to the Strait of Hormuz during the Iran conflict was particularly significant because the narrow waterway handles much of India’s LPG supplies from West Asian producers, including Saudi Arabia.As overseas supplies tightened, the government directed domestic refiners in March to maximise LPG production, including by diverting some refinery streams that would otherwise have been used to produce petrochemicals.Domestic LPG production was eventually raised to around 55,000 tonnes a day at the height of the supply crunch.The government also prioritised household supplies, initially restricting LPG sales to industrial and commercial customers before gradually restoring them as the situation improved. Households faced longer intervals between cylinder bookings and were encouraged, where possible, to switch to piped natural gas.Those emergency production measures were gradually withdrawn after supplies began easing from mid-June.New framework makes crisis measures permanentThe August 13 order effectively turns some of the lessons from that episode into a standing supply-security framework.Unlike the emergency measures introduced during the crisis, the new system specifies how much LPG individual facilities should be capable of producing when required.The government has also given itself the power to direct refiners, oil-marketing companies and upstream producers to increase LPG output for specified periods and quantities when necessary to ensure adequate domestic supplies and distribution at fair prices.When such directions are issued, companies will be required to increase production within the stipulated timeframe.Refiners and upstream companies have also been directed to maintain adequate infrastructure for storing, transporting and evacuating the specified quantities of LPG, either themselves or through other entities such as the railways and road-tanker operators.Refineries asked to find ways to squeeze out more LPGThe government also wants companies to examine whether existing refining infrastructure can produce more LPG.The order directs companies to implement technically and economically feasible measures such as converting naphtha into LPG and upgrading fluid catalytic cracking units.Such investments could allow refineries to increase LPG production beyond the levels currently considered achievable.Companies undertaking such upgrades will have to inform the Centre for High Technology or another authorised agency.The framework will also evolve as India’s refining and gas-processing capacity expands.The government will update the production schedule twice a year, on January 1 and July 1, to account for new refineries and upstream projects as well as additional capacity created through technology, storage, transportation and other infrastructure upgrades.The framework is intended to leave India better prepared for another disruption to overseas LPG supplies, reducing the risk that an external shock again forces the government to ration supplies or rapidly rearrange refinery production.

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