Dahej expansion capacity for GAIL and GSPC

Vol 15, PW 2 (28 Jul 11) Midstream & Downstream

Petronet-LNG wants ‘anchor customers’ GAIL and GSPC to each book part of a proposed 5m t/y expansion to its 10m t/y Dahej LNG terminal in Gujarat.

A senior Petronet-LNG source confirms to this report that it is in the initial stages of talking to GAIL and GSPC about its plans to offer long-term capacity in the proposed Dahej expansion. “But we have yet to decide exactly how much of the additional 5m t/y we might offer to GAIL and GSPC,” he clarifies.

“Before we do that, we need to prepare a Detailed Feasibility Report (DFR) and take a final decision about whether we even plan to go ahead with this expansion.” An internal Petronet-LNG team, he adds, is expected to take at least three months to prepare a DFR in which it will asses market demand for additional R-LNG from Dahej.

“We have the experience and the workforce to prepare this DFR ourselves,” we learn. But Petronet-LNG also plans to hire a consultant to confirm the results of the DFR, once it is ready.

In return for booked capacity at Dahej, Petronet-LNG wants GAIL and GSPC to pay a certain proportion of the costs associated with expanding the terminal’s current capacity. “Funds are not really a problem for us,” we learn.

“But we believe our anchor customers should pay their share. Money that GAIL and GSPC pays toward the expansion project could be adjusted later against their LNG regasification charges.

” Petronet-LNG has also to decide how many additional LNG storage tanks it could install at Dahej as part of the proposed expansion. “It could be either two or three tanks (each with a 160,000-cubic metre capacity),” we are told.

“But we will definitely need to set up regasification facilities.”

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