India Unconventional Gas Market Growth Factors: What’s Fueling the Industry Boom?

India Unconventional Gas Market Growth Factors: What’s Fueling the Industry Boom?

Sep 1, 2025 - 15:00
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India Unconventional Gas Market: Industry Analysis, Trends, and Forecast 2030

The India Unconventional Gas Market has witnessed notable growth over the past decade, driven by a combination of technological advancements, supportive government policies, and increased investments in exploration and production. According to the TechSci Research report, “India Unconventional Gas Market- By Region, Competition, Forecast and Opportunities, 2030F”, the market was valued at USD 1.51 billion in 2024 and is projected to grow at a CAGR of 4.21% through 2030.

This expansion reflects India’s growing focus on energy diversification and sustainability. Unconventional gas sources such as shale gas and coal-bed methane (CBM) are attracting substantial investment from leading energy companies, including Oil and Natural Gas Corporation (ONGC) and Reliance Industries Limited (RIL). These efforts are aimed at reducing dependence on imported fossil fuels while supporting the country’s energy security and environmental goals.

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Key Drivers of Market Growth

Surge in Exploration and Production Activities

The growth of the India Unconventional Gas Market is primarily fueled by the expansion of exploration and production activities across shale gas and CBM reserves. Domestic and international players are investing heavily to unlock India’s unconventional resources. Regions such as Gujarat, Rajasthan, and Madhya Pradesh have emerged as key exploration hubs due to their abundant shale gas deposits.

Government initiatives have also played a pivotal role. Policies such as the Hydrocarbon Exploration Licensing Policy (HELP) and Open Acreage Licensing Policy (OALP) have streamlined regulatory procedures, creating a conducive environment for investment. These measures provide companies with greater certainty and ease of operations, encouraging more robust participation in the sector.


Technological Advancements

Technological innovation has significantly enhanced the extraction of unconventional gas in India. Techniques such as horizontal drilling and hydraulic fracturing (fracking) have allowed companies to access previously unreachable reserves. These methods have not only increased production efficiency but also reduced operational costs, making unconventional gas more economically viable compared to traditional fossil fuels.

Additionally, innovations in monitoring and well completion technologies have optimized production performance and minimized environmental impact. With these advancements, unconventional gas is increasingly being recognized as a sustainable and cost-effective energy source, paving the way for market expansion.


Government Policies and Regulatory Support

The Indian government has been instrumental in fostering growth within the unconventional gas sector. In 2018, a comprehensive policy framework was introduced to support the exploration and exploitation of shale oil/gas and CBM. These policies aim to reduce dependence on conventional energy imports while promoting energy security.

Furthermore, steps taken to deregulate the hydrocarbon industry have encouraged private sector and foreign investments, fostering competition and innovation. By streamlining licensing processes and offering investment incentives, the government is actively creating a favorable market landscape that supports sustainable development and technological adoption in unconventional gas exploration.


Environmental Considerations

Unconventional gas offers notable environmental benefits, emitting fewer greenhouse gases than conventional fossil fuels. This positions it as a cleaner alternative, contributing to India’s climate goals and energy transition initiatives.

Industries are increasingly adopting unconventional gas due to its lower carbon footprint and cost-effectiveness. The combination of environmental and economic advantages makes shale gas and CBM a preferred choice for power generation, industrial use, and transportation applications, further solidifying market growth prospects.


Segmental Analysis: Ingredient Insights

The India Unconventional Gas Market is segmented by type, application, regional distribution, and company. Understanding these segments is critical for analyzing growth patterns and identifying investment opportunities.

By Type

Among unconventional gases, shale gas is the fastest-growing segment. Extracted from deep underground shale rock formations, shale gas offers significant potential due to its abundant availability across India. Technological advancements such as horizontal drilling and fracking have enabled more efficient and cost-effective extraction.

Shale gas also provides environmental benefits, producing fewer greenhouse gases than conventional fuels. These factors have made shale gas increasingly attractive for industries, positioning it as a key driver in the India Unconventional Gas Market. Other types, including tight gas and coalbed methane, continue to complement the market landscape with substantial growth potential.


By Application

Unconventional gas has diverse applications across industrial, residential, commercial, power generation, and transportation sectors. Industrial usage remains a primary driver, with energy-intensive manufacturing processes increasingly relying on shale gas and CBM. Residential and commercial applications are growing steadily as natural gas infrastructure expands in urban and semi-urban regions.

Power generation is another major application, with gas-based plants providing a reliable and cleaner alternative to coal-fired electricity. In the transportation sector, the adoption of compressed natural gas (CNG) vehicles is rising, further creating demand for unconventional gas resources. This diverse range of applications underscores the sector’s importance in India’s energy landscape.


By Region

Western India is a major hub for shale gas and tight gas reserves, while Eastern India primarily focuses on coalbed methane. Central India is emerging as a promising exploration area with considerable shale gas potential.

The regional distribution of reserves influences investment and infrastructure development patterns. Strategic initiatives for transport, storage, and processing facilities are being implemented to ensure the optimal utilization of unconventional gas resources across these regions.


Major Companies Operating in the Market

Leading players driving growth in the India Unconventional Gas Market include Oil & Natural Gas Corporation (ONGC), Chevron Petroleum India, Exxon Mobil India, Reliance Industries Limited (RIL), and Oil India Limited (OIL).

These companies are leveraging advanced technologies, investing in exploration projects, and forming strategic collaborations to unlock the full potential of India’s unconventional gas resources. Their initiatives are shaping the competitive landscape and driving sustainable market growth.


Future Outlook

The future of the India Unconventional Gas Market appears robust, with technological innovation, government support, and private investment poised to propel growth. Expansion in shale gas and CBM exploration, along with increasing adoption in power generation and transportation, will further strengthen the market.

As India pursues its energy transition and climate targets, unconventional gas will play a crucial role in reducing dependency on imported fossil fuels, lowering carbon emissions, and ensuring energy security. Continuous R&D and investments in infrastructure are expected to sustain long-term market momentum.


Research and Development (R&D) Initiatives

R&D has been instrumental in improving extraction efficiency and reducing production costs. Innovative drilling techniques in regions like Western India have unlocked untapped reserves, positioning unconventional gas as a competitive alternative to conventional energy.

Collaborations between domestic and international research organizations are enhancing technical expertise and fostering innovation. These initiatives support the deployment of advanced technologies, improving operational efficiency and environmental compliance in the sector.


Market Opportunities and Challenges

The India Unconventional Gas Market offers multiple growth opportunities, including infrastructure development, exploration of untapped reserves, and adoption in emerging applications like gas-based power plants and CNG transportation.

However, the market faces challenges such as high initial capital investment, regulatory compliance, and global energy price volatility. Addressing these challenges requires strategic planning, technological innovation, and robust policy support to ensure sustainable growth.

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FAQ

Q1: What is the current size of the India Unconventional Gas Market?
Answer: The India Unconventional Gas Market is projected to reach USD 1.51 billion by 2024 and grow at a CAGR of 4.21% through 2030.

Q2: Which segment is growing fastest in the India Unconventional Gas Market?
Answer: The shale gas segment is the fastest-growing due to abundant reserves, technological advancements, and environmental benefits.

Q3: Who are the key players in the India Unconventional Gas Market?
Answer: Leading companies include ONGC, Reliance Industries Limited, Chevron Petroleum India, Exxon Mobil India, and Oil India Limited.

Q4: What government policies support the unconventional gas sector in India?
Answer: Policies such as HELP and OALP facilitate licensing, encourage private investment, and streamline operations.

Q5: What are the major applications of unconventional gas in India?
Answer: Applications include industrial, residential, commercial, power generation, and transportation.

Q6: How does unconventional gas contribute to environmental sustainability?
Answer: Unconventional gas, including shale gas and CBM, produces lower greenhouse gas emissions than conventional fossil fuels, supporting India’s carbon reduction goals.


For the full report and detailed insights, access: India Unconventional Gas Market




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