Hindustan Petroleum Corporation Ltd is targeting up to 45 percent growth in its city gas distribution business in the current fiscal year, building on 44 percent growth recorded last year. The company plans to expand its customer base and pipeline network while increasing the availability of compressed natural gas and piped natural gas across its operating areas.

Anuj Mehrotra, Executive Director for Natural Gas at HPCL, said the company is focusing on accelerating domestic PNG connections, expanding its industrial and commercial customer base, commissioning new CNG stations and strengthening its pipeline infrastructure.

HPCL is also targeting up to 25 percent growth in its liquefied natural gas business, compared with 20 percent growth achieved in FY26. The company sees LNG as an important opportunity in sectors such as mining, particularly for long haul trucks and heavy equipment where LNG could provide an alternative to diesel.

The company plans to commission around five LNG dispensing stations this fiscal in collaboration with other industry participants. These stations are expected to be located along major highways and freight corridors to support long haul commercial transportation. HPCL also aims to commission up to 50 CNG stations, with a focus on improving availability in Tier II and Tier III cities where demand for CNG is increasing.

The company is also evaluating the use of virtual pipelines to supply LNG to industrial and commercial customers located beyond the existing physical gas pipeline network. Under this model, LNG can be transported through cryogenic tankers to customer locations, where it is stored, regasified and supplied as natural gas.

HPCL believes virtual pipelines could help create gas demand in areas where conventional pipeline infrastructure is currently unavailable or economically difficult to develop. As demand increases, some of these locations could eventually become viable for permanent pipeline connectivity.

The company is also focusing on integrating compressed biogas into its existing city gas distribution network rather than developing standalone CBG dispensing stations. HPCL is working with oil and gas companies, state governments, original equipment manufacturers, technology providers, infrastructure developers and CBG producers to develop the broader clean energy ecosystem.

The heightened energy security concerns arising from the West Asia conflict have further highlighted the importance of diversified energy sourcing and wider gas connectivity. HPCL is seeking to build an integrated network in which CNG, LNG, PNG and CBG complement each other and support India's transition towards cleaner and more secure energy supplies.

HPCL's expansion plans come against a challenging earnings backdrop. The company reported a consolidated net loss of Rs 12,264.67 crore in the first quarter, compared with a net profit of Rs 4,110.93 crore in the year ago period, as elevated crude oil prices and subdued marketing margins weighed on profitability.