Vol 2, PW 24 (23 Dec 98) Midstream & Downstream

The race is on to be the first company to start receiving LNG supplies into India and by all accounts Enron is winning.

Last week the US energy major, through its Indian subsidiary, the Dabhol Power Company (DPC), signed a 20 year agreement with Oman LNG* for the annual supply of 1.6m tonnes a year (t/y) of LNG to its power plant in Maharashtra. Under the Sale and Purchase Agreement (SPA), the first consignment of LNG to India from Oman LNG should arrive by the end of 2001.

By this time, DPC hopes to have built an LNG import terminal to receive the gas for its 2,450-MW power project at Dabhol. The 826-MW first phase of Dabhol is expected to go on stream shortly, initially run on naphtha, but later on LNG.

Not far behind is Petronet-LNG, the Indian consortium of four state-owned corporations set up to import LNG into India. Petronet-LNG is still negotiating an SPA with RasGas/Mobil for the import of 7.5m t/y of LNG to Cochi (2.5m t/y) and Dahej (5m t/y).

A senior company official tells this report agreement should be finalised in March 1999. Also last week, Petronet-LNG signed a Heads of Agreement in Delhi in a ceremony attended by senior Indian and Qatari officials.

"Petronet has requested us to expedite the commencement of deliveries to India", said Yousef Kamal, Minister of Finance and Chairman of RasGas, highlighting the urgency of the task ahead, "Today's signing keeps us well on track to achieve this objective," he added. Now all that remains is to build the receiving terminals at Dahej and Cochi.

For this, Petronet-LNG has already released newspaper adverts inviting pre-qualification bids for the EPC. The deadline for applicants is end-January 1999.

*Oman-LNG shareholders (%) Govt of Oman 51 ShellGas BV 30 Total SA 5.54 Korea LNG 5 Partex (Portugal) 2 Mitsubishi 2.77 Mitsui 2.77 Itochu 0.92