MGL plans six LNG stations
Mahanagar Gas (MGL) and its Nagpur-based partner Baidyanath LNG plan to set up six LNG dispensing stations over the next 12 months on Maharashtra's highways.
"We are scouting for locations," says an MGL source. "Each LNG station will cost Rs6cr ($723,000) to build, excluding the land price."
MGL signed an MoU with Baidyanath on May 12 (2023), followed by a term sheet and a Special Purpose Vehicle (SPV) at the end of July. MGL holds a 51% stake, and Baidyanath holds 49%.
On the radar are stations in Maharashtra and neighbouring states to dispense LNG as fuel to buses and trucks. "Baidyanath set up India's first commercial LNG station (at Nagpur in Maharashtra on July 12, 2021)," says an MGL source.
"Working together not only makes business sense but will popularise LNG-fired vehicles; with more stations, volumes will pick up quickly." Baidyanath already operates two LNG stations, one in Nagpur and another at Wani nearby.
Under the plan, MGL wants to offer LNG at a 20% discount to diesel. "This will encourage truckers to convert to LNG," we hear.
"Their additional cost of switching from diesel to LNG will get covered in a reasonable time." MGL thinks Electric Vehicles (EVs) are not suitable for long-haul journeys.
"An EV battery is too heavy," we hear. "Hydrogen is an option, but it will take years before hydrogen dispensing infrastructure comes up."
CNG-fired vehicles face similar problems. "CNG cylinders are extremely heavy, and a long-haul CNG-fired vehicle carries more steel than gas," says a gas industry source.
"LNG is the only viable alternative to diesel." Separately, on August 29 (2023), Pune-based newcomer Blue Energy Motors announced an order to supply 100 LNG-fired trucks to state-owned logistics company CONCOR replete with 990-litre cryogenic LNG tanks that can travel up to 1400-km on a full tank.