GAIL feels unfairly targeted in Dahej LNG row

Vol 8, PW 1 (07 Apr 04) Midstream & Downstream

GAIL feels it is being unfairly singled out for the delay in Petronet-LNGs regassified LNG availability tests.

Completion of the availability tests in March was linked to delivery of the LNG ship in December. Final delivery of the ship to Petronet-LNG in South Korea happened on 9th January after repair of damage caused by a typhoon.

This delay ought to have been factored in by Petronet-LNG. GAIL calculated that it would take 45 days to line fill its pipeline with regassified LNG from Dahej, plus another 15 days to commission the line.

Petronet-LNG wants this schedule rushed through in a much shorter time. GAIL believes this was technically impossible.

The pipeline must be gradually cooled down by letting in regassified LNG slowly otherwise it will get damaged. Regassified LNG is delivered to us at high pressure and low temperature.

GAIL adds that Petronet-LNG ought not to worry about the rescheduling of a couple of LNG cargoes, as long as the total number of cargoes imported in a year is unchanged. Yet, GAIL said it would do all that was possible to remedy the situation.

For instance, by increasing the line pack in the Dahej to Vijaipur and HBJ pipelines; expediting linkage to GSPC; and supplying gas to several of GSPCs customers in Gujarat. Thankfully, the crisis blew over and GAIL is now taking in about 11m cm/d.

This is more than the 8.5m cm/d we are contracted to take in during the first year. What does Petronet-LNG say There was a delay of seven to eight days because GAIL wanted to pressurise the Vemar to Jagdishpur section (of the Dahej-Vijaipur-Jagdishpur pipeline) and also to supply regassified LNG to customers along the HBJ.

The ministry review meeting on 21st March was called to find out if our tanks would be empty to receive the third cargo on 23rd March. Following the review meeting, GAIL speeded up work and the Vemar to Jagdishpur section was line filled with regassified LNG on 24th March.

After this, we progressively scaled up evacuation of regassified LNG to 11m cm/d and began our (60%) availability tests on 27th March. This test was completed on 29th March.

On 28th March we wrote to our offtakers that commercial supplies would begin as scheduled on 1st April. Petronet-LNG tells us commercial supplies began as planned on 1st April.