Does southern India need LNG at Kakinada

Vol 4, PW 13 (02 Aug 00) Midstream & Downstream

With Kakinada firmly back on the LNG map, southern India - like western India before it - is beginning to look slightly crowded.

Three "serious" LNG terminals are now competing for the same cake. Will they all survive A 2.5m t/y terminal at Cochi in Kerala, promoted by Petronet-LNG, has suddenly sprung to life following its much-publicised backing from Subbaram Narayan, secretary in the oil ministry and chairman of Petronet-LNG.

Last month, Petronet-LNG issued a 'Request for Qualification' notice to private EPC contractors interested in constructing the LNG port on a Build Own Operate and Transfer (BOOT) basis. This, coupled with the July 12th signing of an agreement to construct a 1,000 km gas pipeline from Cochi to Bangalore, illustrates the speed with which state and central authorities want to push this project through after months ofinactivity.

No doubt some plodding from RasGas pushed the project along. Qatar is to supply 2.5m t/y to the Cochi terminal.

In neighbouring Tamil Nadu, the CMS Energy-led Dakshin Bharat Energy Consortium shows equal determination to proceed with construction of its 2.5m t/y terminal at Ennore, despite a mild threat issued to local authorities by CMS chief operating officer Victor Fryling, which was repeated in the local press. Fryling said capital costs will begin to escalate if the company does not begin construction by March 1st next year and that the company needs to know where it stands by January at the earliest.

With Cochi and Ennore so far ahead of the pack has anyone bothered to ask if an LNG terminal at Kakinada is really needed