Gujarat Gas Limited (GGL) is intensifying efforts to ensure a stable fuel supply to Morbi’s ceramic industry amidst a global energy crisis. Currently, 142 units are operational due to coordinated actions taken to tackle supply disruptions and increasing costs.
The recovery in Morbi follows collaborative initiatives by GGL and the Morbi Ceramic Association after facing challenges caused by fluctuations in global liquefied natural gas (LNG) markets and supply interruptions linked to geopolitical tensions earlier this year. Before the crisis in February, 377 industrial consumers in Morbi used piped natural gas (PNG) from GGL, while around 415 units relied on propane from oil marketing companies like Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL).
These propane-dependent units represented nearly 70% of the total daily fuel consumption, equivalent to about 5.6 MMSCMD (natural gas). GGL mentioned that its supply had increased in early March, but global LNG availability disruptions due to the US-Iran conflict resulted in constraints. Following government directives, the company reduced supply to around 80% of the average consumption over the previous six months.
Due to higher production costs, propane availability restrictions, and increased freight rates, several ceramic units voluntarily halted operations from mid-March. In response, GGL collaborated with manufacturers to facilitate a transition from propane to natural gas and arranged additional supplies despite elevated international prices. The company affirmed that it continued gas distribution in April as per government regulations and sourced sufficient volumes from international markets outside the Middle East at prevailing rates to meet industrial demand.
Global LNG prices have remained high, ranging from $18 to $20 per MMBtu. GGL expressed solidarity with Morbi’s ceramic industry during these challenging times, aiming to overcome obstacles through mutual trust and elevate the sector to new heights. The company’s teams are in constant coordination with industry representatives to address pricing and supply concerns as the sector strives to resume normal operations.
