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| Petronet LNG to import additional natural gas from Qatar |
| Press Trust of India / New Delhi Aug 27, 2009, 15:50 IST |
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Energy-hungry India will from November receive additional liquefied natural gas (LNG) from Qatar, raising imports of the fuel to 7.5 million tons a year.
Petronet LNG, a joint venture of state-run IOC, GAIL, ONGC and BPCL, currently imports 5 million tons a year of LNG on long-term contract from RasGas of Qatar.
"We will start receiving the tranche-II LNG of 2.5 million tons a year from November," Petronet CEO and Managing Director Prosad Dasgupta told reporters here.
Tranche-A supplies of 5 million tons a year began in 2003 and were supplied at a fixed price of $2.53 per million British thermal unit for the first five years. The rates have since beginning of 2009 been linked to crude oil prices.
Besides, Qatar also supplies 1.25 million tons a year of LNG on short-term contract to meet fuel needs of Ratnagiri Gas and Power Pvt Ltd - the owner of Dabhol power plant.
The short-term contract expires September-end, he said adding that Petronet is importing LNG from spot markets to meet growing energy needs.
"We imported four spot cargoes in April-June. During the current quarter, we have so far imported four cargoes and will import two more during the remainder of August and September," he said. "For October and November, we have booked 5 cargoes."
Besides the spot cargoes, Petronet will also import about 1 million tons per annum of LNG for Pragati Power of Delhi for three years beginning March 2010, he added.
Dasgupta said there was ample demand for imported fuel, the delivered price of which is almost double of the $4.20 per million British thermal unit rates fixed for natural gas from Reliance Industries' eastern offshore KG-D6 fields.
"Volumes will be driven by supplies not demand," he said.
Petronet sold a record 99 trillion Btus of gas in the first quarter of current fiscal. It had sold 96 trillion Btus in Q4 of 2008-09 and 78 trillion Btus in Q1 of last fiscal.
"Pragati Power has placed a demand for 16 cargoes on us for three years which we are confident of tying up from the spot market," he said.
The country's largest liquefied natural gas importer is also planning a $100 million follow-on public offer or a rights issue in 2011-12 to part fund a 1,200-Mw power plant to be set up at Dahej in Gujarat, Dasgupta said.
The 1,200-Mw power plant will cost Rs 3,500 crore, 30 per cent of which will be through equity contribution and internal accruals. The remaining 70 per cent would be debt, he said.
Dasgupta said the power plant which will use the LNG as fuel, will be built in 33 months from the date of award of contract that may happen in the second quarter of 2010. About 50 hectares of land adjacent to its LNG receipt facility at Dahej has already been acquired.
The 70 per cent of the power generated at the plant will be sold to states like Kerala, Andhra Pradesh, Karnataka and Tamil Nadu while the remaining would be sold on merchant power basis, he said.
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