Ultra Gas targeting to add 15 LNG retail stations by end of fiscal: CEO

Ultra Gas, the Essar-backed green fuel retailer, plans to add 15 retail stations for liquefied natural gas (LNG) used in vehicles by the end of the current financial year, taking its network to 25, Maqsood Shaikh, chief executive officer and managing director, told The Hindu on Thursday.

The company aims to expand its network to more than 100 outlets by the end of FY29, entailing an investment of ₹900 crore.

The expansion is expected to improve refuelling access for long-haul freight operators and encourage the adoption of LNG-fuelled trucks. With 25 stations operational by March, the company expects refuelling facilities to be available every 200-250 km across its network.

“With the 25 stations expected by the end of March, there would be 98% assurance that refuelling stations would be available in a span of [every] 200 to 250 kilometres,” Mr. Shaikh said.

The network expansion could generate demand for around 6,000 LNG-fuelled trucks, he added.

Cost advantage

Mr. Shaikh said LNG-powered freight transportation could deliver fuel-cost savings of 25-30% compared with diesel-powered trucks, combining better fuel efficiency with lower fuel prices.

“LNG-fuelled trucks would help augur 25%-30% more savings than diesel. 15% would be because of its standalone fuel efficiency during combustion and the rest because of 10-15% discounting to diesel,” he said.

Ultra Gas is replicating an outlet design that has already received approval and support from the Petroleum and Explosives Safety Organisation (PESO). A recent amendment to the Static and Mobile Pressure Vessels (Unfired) Rules, removing the requirement for a no-objection certificate from the district magistrate, is also expected to accelerate the establishment of new stations, according to him.

Call for dedicated policy

Mr. Shaikh stressed that a dedicated LNG policy was essential to address uncertainty among transporters, lenders and investors.

“Today fund managers and bankers are not wanting to sponsor LNG trucking projects because they are not sure about the government’s viewpoint on the adoption of the fuel. It suffers the lacuna of being overshadowed by electric mobility,” he said.

He also emphasised the need for long-term LNG procurement agreements rather than reliance on spot purchases. Ultra Gas currently has five-to-10-year supply agreements with GAIL, Indian Oil, Shell and Hindustan Petroleum.