VGS Cavallo moves ahead with Kakinada FSRU

Vol 17, PW 9 (28 Nov 13) Midstream & Downstream

US-based VGS Cavallo is forging ahead with plans to set up a LNG Floating Storage and Regasification Unit (FSRU) off Kakinada in Andhra Pradesh to rival plans by Shell, GAIL and Gaz de France.

Consultancy L&T-Ramboll will hand in the Environment Impact Assessment (EIA) study to VGS Cavallo by end-November for its proposed 3.6m t/y Krishna Godavari LNG Terminal (KGLNG), estimated to cost around Rs3000cr ($500m). VGS will also present a Coastal Regulation Zone study by Anna University’s Institute of Remote Sensing to the Andhra Pradesh Pollution Control Board for the mandatory public hearing, expected next month (December).

VGS will then submit the minutes of the public hearing and the EIA study to the environment ministry. Environmental clearance is expected by March 2014.

In May or June 2014, China’s Wison Group is likely to finish constructing the 129,000 cubic metre capacity FSRU, which should begin operations by January 2015. VGS now plans to moor the vessel 20-km offshore in water depths of 17 metres, northeast of Hope Island, even though it was previously reported the vessel would be 8-km offshore.

VGS will bring R-LNG to shore through a 36-inch diameter subsea pipeline and feed it into pipelines operated by GAIL or Reliance to supply power, ceramics and textiles factories. VGS isn't afraid of competition from other east coast FSRU projects.

“There is room for everybody," we hear. "India needs gas.