LPG Gas Bank Installation: Capex, Sizing & Compliance
LPG gas bank installation is the foundational decision for any commercial or industrial user with meaningful LPG demand. The choice between cylinder banks and bulk storage drives everything downstream — operational complexity, per-kg cost, space requirements, and compliance scope. Get it wrong and you either overpay for infrastructure you don't need or hit a capacity wall within a year.
This guide walks through the decision framework we use on LPG gas bank installation projects across Delhi NCR, Haryana, Punjab, Chandigarh, Rajasthan, UP and Uttarakhand.
Types of LPG gas banks
- Cylinder manifold banks: 2×2 to 32×32 configurations using standard 14.2 kg or 19 kg commercial cylinders. Economical below ~300 kg/day demand.
- Mini-bulk tanks (450-990 kg): small bullet tanks filled on-site by a tanker. Fits where a cylinder bank would require daily handling.
- Above-ground bulk bullets (1-50 MT): horizontal cylindrical storage. Most common industrial form factor.
- Mounded bullets (10-200 MT): bullets buried under earth mounds. Preferred for urban sites, coastal plants, and enhanced blast protection.
Cylinder bank vs bulk: where's the break-even?
Per-kg LPG cost from commercial cylinders in Delhi NCR (2026): ₹92-₹105. Per-kg from bulk delivery: ₹75-₹85 depending on tanker distance.
At 300 kg/day consumption, bulk saves ₹20/kg × 300 = ₹6,000/day or ~₹2,20,000/year. This alone justifies a ~₹15-20 lakh mini-bulk tank within 8-10 years.
Beyond financial: bulk eliminates daily cylinder handling, cylinder safety stock, and running-out-of-gas incidents. Most businesses that cross 150-200 kg/day migrate to bulk within 12-18 months.
Sizing a bulk tank
Size for 2-4 weeks of supply:
- Daily demand × 14 = minimum tank working volume
- Daily demand × 30 = comfortable tank working volume (monthly refill)
Example: 500 kg/day demand → 7,000 kg minimum (2-week) to 15,000 kg comfortable (monthly). A 5 MT bullet is the practical minimum; a 10 MT gives operational buffer.
PESO licensing
Any storage above 100 kg requires a PESO licence under the Petroleum Act 1934. Key considerations:
- Form XIV / Form XV: application forms depending on storage category.
- Safety distance: minimum distances to boundaries, buildings, and other tanks per OISD-144.
- Site plan: drawn-to-scale plan showing tank, access, fire-water tank, bunding, fencing.
- Pressure relief sizing: proper PSV sizing for the tank.
- Fire-fighting: water sprinkler system, fire-water reserve, hydrant points.
- Earthing: dedicated earth for the tank and all metallic components.
Approval typically takes 8-16 weeks. Our team prepares the full application pack and handles authority liaison.
Land / space requirements
Typical footprint (above-ground bullet):
- 1 MT bullet: 10 × 8 m including safety setbacks
- 5 MT bullet: 15 × 10 m
- 10 MT bullet: 20 × 15 m
- 25 MT bullet: 25 × 20 m
Mounded installations reduce footprint by 40-60% because the earth mound itself satisfies the safety-distance requirement. For urban/space-constrained sites, mounded is often the only feasible option.
Capex ranges (2026)
- 1 MT above-ground bullet (turnkey): ₹10,00,000 – ₹16,00,000
- 5 MT above-ground bullet (turnkey): ₹28,00,000 – ₹45,00,000
- 10 MT mounded (turnkey): ₹65,00,000 – ₹95,00,000
- 25 MT mounded (turnkey): ₹1,60,00,000 – ₹2,50,00,000
"Turnkey" includes tank, foundation, piping, vaporiser, fire-fighting, PESO licensing support, and commissioning. Excludes land, statutory fees, and building civil work.
Redundancy: always twin, never single
Commercial gas banks should always have dual supply paths — twin manifolds on cylinder banks, dual vaporisers on bulk systems. A single point of failure means a single point of downtime. For hotels, hospitals, and 24/7 plants this is non-negotiable.
Frequently asked questions
Can you install a bulk gas bank in an urban area?
Yes — with mounded installations and strict PESO compliance, we have delivered bulk banks in Delhi, Mumbai, Bengaluru and other dense urban zones.
How long does a full PESO-approved bulk installation take?
From concept to commissioning: 4-6 months typical, of which 2-4 months is approval lead time.
Do you offer tank-level remote telemetry?
Yes — IoT-based tank level monitoring is available as an add-on. Dashboard shows remaining days, refill scheduling, and consumption trends.