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| Slowdown holds up Okha LPG project |
| Maulik Pathak / Mumbai/ Ahmedabad Jul 06, 2009, 00:32 IST |
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Sweden-based EIIL has invested Rs 150 cr in the project coming up near Jamnagar.
Just when things were looking brighter for the LNG project at Okha, near Jamnagar, which has been delayed by 10 years, the economic slowdown has held it up again.
The Rs 500-crore petroleum jetty project, promoted by Energy Infrastructure India Ltd (EIIL), the wholly-owned subsidiary of Swedish Energy Infrastructure Group, has been put on hold due to the slowdown and extension of subsidy on LPG till 2010, said sources close to the development.
EIG chairman Fred Jones, on his visit to Gujarat in March, informed senior government officials that the progress on the Okha project was on hold due to the recession, they said.
“Further progress is temporarily on hold due to short-term moratorium on new investment projects as a consequence to the global economic slowdown,” EIIL said on the status of the project to the state.
An e-mailed query to EIIL remained unanswered.
Several reasons have been cited for the delay in project, the main being land acquisition problems, the sources said. EIIL could take possession of only 42 acres of government wasteland of the allotted 98 acres, the company had earlier communicated to the state authorities.
The company has invested close to Rs 150 crore in the project. Besides, it has also roped in London-based shipping company Tsakos Shipping to import LPG and drawn up plans to sell it under the brand Max Gas.
EIIL is keen to tap the LPG-deficient north Indian market by importing close to 800,000 tonnes a year at Okha. It also plans to set up bottling plants at several places in Rajasthan and northern states.
The gas would be transported to Jamnagar through a 140-km pipeline and this would connect to the existing Jamnagar-Loni pipeline to distribute the gas in north India.
For this, EIIL has tied up with GAIL for constructing the Okha-Jamnagar pipeline. However, GAIL is yet to be allocated land for putting up their receiving/pumping station for EIIL. As a cascading effect, GAIL could not initiate the process of laying the pipeline despite having entered into an agreement with EIIL, government sources said.
The Stockholm-based firm has also tied up with Infrastructure Lease & Financial Services (IL&FS) for partially financing the project.
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