GMR Energy looking for R-LNG supplies

Vol 13, PW 25 (03 Jun 10) Midstream & Downstream

Bangalore-based infrastructure to power group GMR Energy is in the market to source both short and long term R-LNG supplies for its massive electricity generation expansion programme.

“GMR is looking at a mix of LNG sources,” we hear. “This could be spot or through long term supply contracts.

” PETROWATCH learns GMR is in talks with several suppliers for R-LNG, among them GAIL, but nothing has yet been finalised. “GMR believes 50% of its fuel requirement will eventually be met by R-LNG,” adds a source.

“D6 gas won’t be enough to meet the demands of the Indian power sector.” GMR plans to dramatically increase its India-based power generation capacity with a new 2000-MW gas-fired power station planned at Kakinada in Andhra Pradesh, another 1200-MW plant planned for the Ratnagiri district of Maharashtra and a 768-MW capacity expansion of the 388.5-MW Vemagiri station at Rajahmundry, also in Andhra Pradesh.

Currently its all-India capacity stands at just 808-5-MW. But with all these new projects on the horizon, GMR could eventually need an additional 20m cm/d: 4m cm/d for the Vemagiri expansion; 6m cm/d for the new Ratnagiri station; and a massive 10m cm/d for the proposed 2000-MW gas-fired station at Kakinada, which it wants to commission in 2013.

But GMR’s most pressing requirement is first to find 4m cm/d for the imminent Vemagiri expansion at Rajahmundry. “Time is short,” adds a source.

“GMR wants to commission the first unit (of the 800-MW Vemagiri expansion) by June 2011.” Vemagiri already receives 1.8m cm/d D6 gas and operates at around 70% PLF.

For its Ratnagiri power station, GMR is at the land acquisition stage only; while in Kakinada the union environment ministry last month (May) issued the crucial ‘Terms of Reference’ so it can begin Environmental Impact Assessment (EIA) studies.