The Petroleum and Natural Gas Regulatory Board (PNGRB) has issued new regulations making it mandatory for companies to register before setting up or expanding liquefied natural gas (LNG) terminals. The 2025 regulations replace the earlier requirement for reserving a portion of terminal capacity for third-party access.

This move is intended to streamline investment, enhance competition, and align with India's goal of increasing natural gas's share in its energy mix to 15 percent by 2030. Entities must now secure PNGRB approval before taking final investment decisions (FID), ensuring projects avoid redundant investments and promote equitable gas distribution.

Applicants are required to submit credible business and LNG evacuation plans, along with a Detailed Feasibility Report (DFR). Additionally, a bank guarantee of one percent of the project cost or Rs 25 crore (whichever is lower) must be provided. While previous draft rules proposed reserving 20 percent of short-term capacity for third-party access, industry resistance led to its removal. The regulator will also oversee project timelines and can levy penalties for delays. 

India currently operates seven LNG terminals, including major facilities by Petronet LNG, Shell, GAIL, and Adani Total Gas across various coastal states.