H-Energy, a unit of real estate group Hiranandani, will start importing LNG using a ship-based terminal at Jaigarh port in Maharashtra by May 2018, its Managing Director Darshan Hiranandani said.
The 4-million-tonnes a year floating storage and regasification unit (FSRU) will cost Rs 1,663 crore, he told PTI here.
"We will start imports in May 2018," he said.
H-Energy leased the FSRU, called GDF Suez Cape Ann, from French group Engie for five years.
The FSRU will be berthed at Jaigarh, the starting point for a 635-km coastal pipeline H-Energy is building to Mangalore to open up new gas markets.
Hiranandani said the company is not looking at long-term liquefied natural gas (LNG) import contracts and would offer supplies to customers on short and medium term contracts.
"We have a flexible model," he said, adding the company has gas offtake commitments for 8 million tonnes of LNG.
The FSRU will convert LNG shipped from multiple suppliers back into gas, before transferring it onshore. A 60-km pipeline connecting the terminal to the port has already been laid.
Once operational, this will be the fifth LNG import terminal on the west coast and second in Maharashtra. The west coast already has four LNG import terminals -- Dahej and Hazira in Gujarat; Dabhol in Maharashtra and Kochi in Kerala.
Jaigarh also houses the 5-million-tonnes Dabhol LNG terminal operated by gas utility Gail India.
"Dabhol is inoperational for five months a year during monsoon because of lack of breakwaters. Our terminal will operate through out the year," he said.
Also, another 5-million-tonnes a year terminal at Kochi in Kerala operates at 4-5 per cent because of lack of pipelines to transport gas.
"We will have enough customers (for imported gas)," he said.
The FSRU has a storage capacity of 145,000 cubic metres and is equipped with re-gasification capacity to operate the project at approximately 4-million-tonnes per annum. The FSRU is also capable of reloading LNG onto other LNG vessels.
H-Energy has an option to extend the charter party agreement beyond the initial term on mutual agreement.
The 635-km gas pipeline runs from Jaigarh in Ratnagiri district of Maharashtra to Panjim in Goa and onwards to Karwar in Uttara Kannada district and Udupi in Karnataka before terminating at Mangalore.
The pipeline will have a capacity to carry 17 million standard cubic metres per day of natural gas and will offer 4.25 mmscmd of capacity to third parties for common carrier access.
It will connect major industrial units like refineries, fertilizer plants, petrochemical plants and power plants in the south-western coastal stretch of Ratnagiri, Sindhudurg, Goa, Karwar, Udupi and Mangalore, he added.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)