Home >Companies >News >Petronet LNG to invest ₹2,100 crore at Dahej terminal

Ahmedabad/Mumbai: Petronet LNG Ltd, India’s top gas importer, plans to invest 2,100 crore to expand its terminal capacity in Dahej, Gujarat, from 15 million tonnes per annum (MTPA) to 20MTPA in the next two or three years, said two officials close to the development. Of the total, 1,300 crore would be used to expand the Dahej terminal, while 800 crore will be spent on building LNG storage tanks, they said, requesting anonymity.

Petronet LNG, which built India’s first LNG receiving and regasification terminal at Dahej, operates another terminal in Kochi.

The Kochi terminal has a capacity of 5 MTPA. The company is in the process of building a third terminal, at Gangavaram, Andhra Pradesh.

An investment proposal for the expansion in Dahej has been recently submitted to the Gujarat Maritime Board—the regulator for all the non-major ports and maritime activities in Gujarat, confirmed a senior Gujarat government official, who did not wish to be named.

A Petronet LNG official declined to comment. A company official did not respond to an emailed query.

As a precursor to the ninth Vibrant Gujarat Global Summit, scheduled during 18 to 20 January in Gandhinagar, GMB had organized a road-show in Mumbai on 21 December. The road-show was aimed at highlighting the competitive strength of Gujarat and attracting investments in the state’s maritime sector, said a GMB official, requesting anonymity.

“The investment proposal by Petronet LNG shows that Gujarat is still a leader when it comes to fresh investments," the official said.

Prime Minister Narendra Modi had in October inaugurated a LNG terminal promoted by GSPC LNG Ltd, a subsidiary of Gujarat State Petroleum Corp. Ltd. The project is the third such LNG re-gasification project in the state after Petronet LNG’s Dahej LNG terminal and the Hazira project of Shell Gas BV, a unit of Royal Dutch Shell Plc.

Shapoorji Pallonji group and Swan Energy have also announced plans to set up LNG terminals in Gujarat.

Consumption of natural gas in India has increased by 17.1% on a year-on-year basis during FY19 (April-October period), Care Ratings said in a 19 December report.

Increase in demand and fall in domestic production has led to an increase in imports of LNG by 12.7%.

In the current fiscal year, India imported LNG mainly from Qatar (47%), Nigeria (17%), the US (6%), Angola (6%) and Australia (6%).

R-LNG or re-gasified-liquefied natural gas has catered to 47% of the natural gas consumption during the April to October period.

While Petronet’s Dahej terminal has a long-term LNG sourcing contact with RasGas, and with ExxonMobil for the Kochi Terminal, GAIL’s Dhabol terminal has a 20-year contract with Cheniere Energy. Hazira LNG has sourced cargoes from 17 liquefaction facilities across the globe, ranging from Peru LNG at the extreme west to Sakhalin LNG in the extreme east. Unlike Dahej, Kochi and Dhabol, Hazira terminal is geared more towards short and mid-term contracts instead of long-term.

“India is scheduled to add 27.5 million metric tonnes per annum additional R-LNG terminal capacity in the coming few years depending on the techno-feasibility of the project. The current regasification facilities are all located on the west coast of the country. With the proposed new plants which will be set up on the east coast of India, the disparity in the supply of LNG should diminish," adds Care Ratings.

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