Shipping guidelines for LNG coming soon

Vol 4, PW 14 (16 Aug 00) People & Policy

With so much attention on the construction of LNG terminals and the race to land first supplies, it is easy to forget that India still has no clear guidelines outlining how it will be shipped here.

That could soon change. In Delhi a group of senior bureaucrats (known locally as a 'Core Group of Secretaries') is putting the finishing touches to a series of recommendations that should establish the legal framework for shipments of LNG to India for the next seven years.

Following are some of the key recommendations they are expected to make: Mandatory shipments of LNG to India on a 'free on board' basis Indian shipping companies minimum 26% stake in LNG shipping consortium LNG carriers must register under Indian flag via Merchant Shipping Act (1958) within 12 months Technology transfer from non-Indian to Indian consortium members over 5 years Infrastructure status for related port development Rationalisation of LNG import duty between 5-10% The five-member panel of senior officials from the power, finance, oil, surface transport and fertiliser ministries, was set up on March 24thto formulate a series of recommendations based on an 'LNG Transportation Policy' prepared by CRISIL on behalf of the Ministry of Surface Transport. When it finalises its recommendations, the panel will send them up the ladder to the 'Committee of Secretaries', which in turn will send them to the cabinet.

With luck, this convoluted process will terminate before first supplies land late next year.

LNG Summit