Government sets LPG production targets for refineries:Reliance gets largest quota, steps taken to maintain domestic supply in crisis

Learning from the impact on LPG supply due to tensions and war in the Middle East, the central government has, for the first time, set maximum LPG production targets for the country’s public and private refineries and upstream companies. In an order issued on August 13, the Ministry of Petroleum and Natural Gas has set a total LPG production capacity and target of 63,810 tonnes per day for 21 companies. This target is more than double the total domestic LPG production in the country during FY 2025-26 (35,900 tonnes per day) and covers approximately 70% of the country’s total daily consumption. Whenever there is a gas shortage or supply disruption in the market, this new rule will be implemented immediately. Reliance’s Jamnagar Refinery Gets the Largest Target of 18,000 Tonnes According to the government’s order, the largest share has been given to the private sector company Reliance Industries Limited. Reliance’s Jamnagar Domestic-Tariff Area refinery in Gujarat has received a target to produce 18,000 tonnes of LPG daily. Private sector’s Nayara Energy’s Vadinar refinery, supported by Russia’s Rosneft, has been given a target to produce 4,480 tons of LPG daily.
64% Dependence on LPG Imports in the Country Became the Reason In the financial year 2025-26, India consumed a total of 33.2 million tons of LPG (approximately 91,000 tons per day). Of this, only 13.1 million tons (35,900 tons per day) were produced domestically, while 21.3 million tons (58,400 tons per day) of LPG had to be imported from abroad. Due to more than 64% dependence on imports, when the Strait of Hormuz route was blocked due to the Iran war, supply in India was severely affected. India imports 90% of its needs through this sea route from countries like Saudi Arabia. Emergency restrictions had to be imposed during the crisis in March During the Middle East crisis in March, the government had to divert gas used in petrochemical production to make LPG. At that time, domestic production was increased to 55,000 tonnes per day. During the crisis, sales to commercial and industrial users had to be stopped, the time for LPG refill bookings in homes was extended, and people were encouraged to shift to PNG. These restrictions were lifted in mid-June when the situation normalized. Companies instructed to upgrade infrastructure and technology The ministry has clarified in its order that all government and private refineries and upstream companies must develop and maintain adequate infrastructure for LPG storage, evacuation, and transportation (rail/road tankers). Production schedule to be reviewed every 6 months The government has reserved the right to instruct refineries to increase production and restrict other uses of input streams when necessary. The new framework will be updated on January 1st and July 1st every year.
New targets will be added to it based on new refineries, new upstream gas fields, and improvements in technology and infrastructure.