Vol 3, PW 2 (17 Feb 99) Midstream & Downstream

Luckily, foreign importers of LNG have little to fear.

Since 1991, the general trend of economic policy in India has been to shift items away from the Restricted List to the Open General Licence list, and not the reverse. Any attempt to turn the tide is likely to be met with fierce criticism, domestic and international, and will ultimately be rolled back.

So, why is Petronet-LNG advocating such a radical solution Who is it scared of most The answer is not difficult: British Gas. One of the proposals advocated by Petronet-LNG is that the government - or a future gas regulator - should disqualify LNG terminal projects from being set up within a 100km radius of already approved projects.

In the unlikely event that the government approves such a move, the future of British Gass LNG project at Pipavav would be in question. Pipavav is located just 70km from Dahej.

At present, both Petronet LNG and British Gas, through consultants and the media, are playing out a war of words on the relative merits of each location. Petronet-LNG contends that Dahej is the most suitable port for LNG imports while British Gas claims Dahej is unsuitable for the development of a marine LNG terminal and that Pipavav is a much better location.

A second threat to Petronet-LNG has emerged from the National Thermal Power Corporation (NTPC), which plans to procure LNG on the open market for its power plants at Kawas, Gandhar, Anta, Auriya and Kayamkulam. On 22 January, NTPC held a detailed meeting with LNG suppliers and announced its intention to release Request For Qualification (RFQ) tenders on 22 Feb 1999.

A deadline of September 1999 was set for the selection of an LNG supplier.