Balyan still backing Gangavaram LNG project

Vol 18, PW 19 (21 May 15) Midstream & Downstream

Before retiring as oil secretary Saurabh Chandra told Petronet-LNG chief AK Balyan in no uncertain terms to abandon plans for the Gangavaram LNG terminal in Andhra Pradesh.

But it seems Balyan’s parting shot before he too steps down in July is to ensure the 5m t/y LNG terminal project gets Board approval. "My single point agenda before retiring is to get the Gangavaram project approved," Balyan told PETROWATCH on the sidelines of the India LNG Congress 2015 in Delhi on May 12-13.

"There is enough demand (up to 20m cm/d) to justify the construction of the terminal. An anchor customer is HPCL’s 8.33m t/y (Vizag) refinery which it plans to expand to 15m t/y.

” Balyan adds other customers within a 130-150-km radius might also buy gas. He said Petronet-LNG must meet two conditions to ensure Gangavaram is a viable proposition.

"The first is to ensure pipeline connectivity so we can evacuate gas and don’t have a Kochi situation,” he said. “The second is to sign up firm customers to buy up to 45% of the R-LNG.

” Balyan tells us Petronet-LNG’s marketing department is visiting potential gas customers to secure sales, an exercise likely to be completed by June (next month). “We’ll go back to the Board, probably in July,” he said.

Petronet-LNG holds 76% in the proposed LNG terminal and wants a strategic partner.