Government of India Announces New LPG Allocation Norms for Industrial and Non-Domestic Sectors

NEW DELHI, April 8, 2026— The Ministry of Petroleum and Natural Gas has issued a new directive outlining revised allocation strategies for packed and bulk non-domestic Liquefied Petroleum Gas (LPG).

In a formal communication released today, Secretary Dr. Neeraj Mittal detailed that states have been allotted 70% of their required LPG, which includes a performance-based incentive of up to 10% linked to the successful implementation of reforms promoting Piped Natural Gas (PNG).

The order specifically targets high-impact industrial sectors—including Pharmaceuticals, Food, Agriculture, Steel, and Heavy Water—stipulating that these units will receive 70% of their pre-March 2026 bulk non-domestic LPG consumption levels.

This allocation is subject to a strict sectoral ceiling of 0.2 Thousand Metric Tonnes (TMT) per day. To ensure operational efficiency, the Ministry has established an “inter-se priority” for units that require LPG for specialized processes where substitution by Natural Gas is technically unfeasible.

Furthermore, the directive streamlines the administrative process for specialized industries. While most units must fulfill registration requirements with Oil Marketing Companies (OMCs) and apply for PNG transitions, those using LPG as an integral, non-substitutable input in manufacturing are now exempt from the mandatory PNG application requirement.

Dr. Mittal concluded the dispatch by urging state authorities to expeditiously notify policies regarding Compressed Bio-Gas (CBG) and to communicate the Natural Gas and Petroleum Products Distribution Order 2026 across all relevant departments to ensure seamless energy distribution.