GSPC to switch BG contract from Dahej to Mundra
Last month (August) Petronet-LNG only just completed expanding the Dahej terminal capacity from 10m t/y to 15m t/y.
But already there's speculation that it might have been a wasted investment as GSPC and IndianOil prepare to switch LNG imports to the nearby Mundra LNG terminal when completed. Jointly promoted by GSPC and Adani the 5m t/y Mundra LNG terminal is expected to be ready between June and August 2017 with a R-LNG evacuation pipeline ready by early 2018.
After that GSPC is expected to shift its 2.5m t/y 20-year contract signed in March 2013 with BG (now Shell) from Dahej to Mundra. "GSPC and BG only need to tweak the destination clause in the contract," reports a Gandhinagar source.
"Obviously GSPC will shift to Mundra. If you construct your own house what is the point of staying in rented accomodation?" IndianOil, fast emerging as the third partner at Mundra, may also shift some of its spot imports to Mundra despite its position as a 30% offtaker at Dahej and 12.5% (promoter) stakeholder in Petronet-LNG.
"Unlike GSPC, IOC will have to strike a balance between importing at Dahej and Mundra," we hear. "Just like GAIL does between Dahej and Dabhol." Dahej import volumes will suffer a further short-term hit when GAIL shifts some of its cargoes to Dabhol by end-September once the Ratnagiri terminal reopens after its monsoon vacation.