India Secures Domestic Energy Supply: Centre Mandates Refiners to Produce Up to 63,810 TPD of LPG Till December 2026

In a landmark move to fortify India's energy security against geopolitical vulnerabilities, the Central Government has issued a decisive directive setting a maximum daily production limit of 63,810 tonnes per day (TPD) of liquefied petroleum gas (LPG) for all domestic refiners. Encompassing public sector undertakings (PSUs), joint ventures, and private sector entities, this unprecedented mandate will remain in effect until December 2026. This strategic policy intervention marks the first time the Centre has established a formal bi-annual maximum LPG production limit, directly addressing supply chain anxieties triggered by recent conflicts in West Asia and the resulting disruptions across the critical Strait of Hormuz.

Issued by the Ministry of Petroleum & Natural Gas (MoPNG) via a notification effective August 13, the directive amends the foundational Petroleum Products (Maintenance of Production, Storage and Supply) Order, 1999. The policy empowers the government—acting independently or through the Centre for High Technology (CHT)—to mandate oil refining, marketing, and upstream companies to ramp up output. This ensures uninterrupted domestic availability, equitable distribution, and fair pricing. Crucially, the Centre has established a transparent schedule to update these production targets every January 1st and July 1st, factoring in contributions from new refineries, enhanced upstream capacities, and evolving technological infrastructure.

A closer look at the allocation highlights the significant role played by private sector energy majors alongside state-run enterprises. Reliance Industries (RIL) has been assigned the highest individual daily quota at 18,000 TPD. Meanwhile, public sector giants and regional refiners also shoulder heavy responsibilities: Bharat Petroleum Corporation’s (BPCL) Kochi refinery is mandated to produce 4,800 TPD, Mangalore Refinery & Petrochemicals Ltd (MRPL) stands at 4,600 TPD, Nayara Energy at 4,480 TPD, and HPCL Mittal Energy at 3,600 TPD. In aggregate, the PSU refining bloc—comprising Indian Oil Corporation, BPCL, and Hindustan Petroleum Corporation—is tasked with a cumulative maximum output of 31,470 TPD. Conversely, the private sector holds a mandate of 25,880 TPD, while upstream companies are capped at a maximum of 6,460 TPD.

Beyond setting quantitative caps, the regulatory overhaul demands aggressive operational upgrades. Refiners are legally obligated to develop and maintain robust infrastructure for LPG storage, evacuation, and transportation. Furthermore, the notification instructs oil companies to adopt advanced, economically viable technologies to maximize yields far beyond their baseline minimums. Key technological adaptations include naphtha-to-LPG conversion processes and the modernization of standard gasoline-based fluid catalytic cracking units into advanced petro-fluid catalytic cracking units. Strict oversight will be maintained by the Centre for High Technology, with any contravention of these directives carrying severe penal consequences under the Essential Commodities Act, 1955.

For the broader Indian business and startup ecosystem, this policy underscores a profound national pivot toward supply chain resilience, energy independence, and heavy industrial compliance. As energy logistics and domestic manufacturing take center stage, Indian enterprises operating across the supply chain, logistics, and industrial technology verticals must realign their operational frameworks to support this heightened domestic energy throughput.

"India’s proactive regulatory intervention in mandating strict LPG production caps through December 2026 is a masterclass in strategic economic foresight. By decoupling critical domestic energy supplies from volatile West Asian geopolitical shocks, the government is building an unshakeable foundation for national economic stability. For the broader business and startup ecosystem, this policy signals a massive push toward advanced industrial manufacturing, technological upgrades like naphtha-to-LPG conversion, and robust supply chain infrastructure. When national energy security is aggressively protected, it creates a secure, predictable macro environment where enterprises across logistics, manufacturing, and deep-tech can innovate, scale, and thrive without fearing sudden external market disruptions." — Dr. Shishir Gupta, Founder & CEO, StartupLanes