BRITISH GAS: THE BIGGEST THREAT

Vol 2, PW 23 (09 Dec 98) Midstream & Downstream
     

What is clearly not in doubt is that Petronet-LNG will eventually sign on the dotted line for 7.5m tonnes a year (t/y) of LNG.

By 2002, when LNG receiving terminals are complete, some 5m t/y will begin arriving at Dahej in Gujarat and 2.5m t/y at Cochin in Kerala. Petronet-LNG is confident it has cornered the market, particularly in industrialised Gujarat, Indias second most prosperous state after Maharashtra.

Gujarat is on the HBJ pipeline, Indias principal gas artery, used mainly to transport gas from the Bombay High. Well before first LNG supplies hit India in 2002, Petronet-LNG predicts there will be a sharp fall in gas production from the Bombay High and that this will ensure a constant stream of buyers.

Nonetheless, it is keenly aware of a perceived threat to its operations posed by British Gas, which plans to import Yemeni LNG via the port of Pipavav. In private, Petronet-LNG views British Gas as its principal rival for customers in Gujarat.

In the same breath, it dismisses Enron as "irrelevant". Likewise, Petronet-LNG is acutely sensitive to what it sees as British Gass attempts to discredit it via a whispering campaign.

Petronet-LNG accuses BG of trying "to steal" customers by spreading rumours that it (Petronet-LNG) has no experience in the LNG business and will ultimately fail to deliver. Paranoia Perhaps, but it is no secret that BG and Petronent-LNG are not the best of friends.