Dabhol mess hits Trombay LNG project

Vol 5, PW 9 (20 Jun 01) Midstream & Downstream

Ongoing dispute between Enron and the Maharashtra State Electricity Board has cast a cloud over another LNG project in India: theproposed Tata-Total LNG import terminal at Trombay in Mumbai.

"The Dabhol problem does not affect us directly, but it has hit lenders' perception of India," Emmanuel Courcier at TotalFinaElf tells Petrowatch. Uncertainty over Petronet-LNG's Dahej project is not helping either.

"The global picture for LNG is not optimistic," adds Courcier. "Nobody wants to repeat the mistakes of Dabhol and Dahej." Total's Trombay project is waiting for clearance from New Delhi's ministry of environment and forests and the controller of explosives.

On 15th February this year, Maharashtra gave "locational clearance", followed by a mandatory "Public Hearing". Courcier is optimistic construction can start by 2002 even though financing is not in place.

These depend on the outcome of gas supply agreements with potential LNG customers. "We are negotiating back-to-back agreements." Is Total's optimism misplaced Local activist group Tata Gas Virodhi Samiti has begun a public awareness campaign, demanding removal of the project from the densely populated north-east Chembur-Trombay suburb, home to India's nuclear weapons facility, two petroleum refineries, a fertiliser factory, an LPG facility, an Indian navy munitions depot and several chemical factories.