GSPC LNG in talks with Dahej SEZ units for supply of gas

These include facilities of ONGC Ltd, Torrent Energy Ltd with combined gas demand of 3.8 MMTPA

State-run GSPC LNG Ltd (GLL) which is building LNG terminal at Mundra port in Kutch is in talks with units located in Dahej Special Economic Zone (SEZ) for supply of gas once the terminal commences operations. These include unit of ONGC Ltd and Torrent Energy Ltd to name a few.

GLL is a joint venture between state-owned Gujarat State Petroleum Corporation (GSPC) Ltd and Adani Group. It has proposed to set up a 5 Million Metric Tons Per Annum (MMTPA)  LNG terminal on the Mundra Port of Adani Port and Special Economic Zone (APSEZ) Ltd. APSEZ was recently awarded environmental clearance  for its SEZ land in Mundra.

GLL plans to supply gas to the Dahej SEZ units through another GSPC subsidiary Gujarat State Petronet Limited (GSPL), which specialises in infrastructure for transmission of gas across the state and allows last-mile linkage to the end-users.

In April this year a consortium led by Toyo Engineering India Ltd with Toyo Engineering Corporation Japan (Toyo Japan) as a member, was awarded engineering, procurement and  construction (EPC) contract on a turnkey basis for the 5 MMTPA Liquefied Natural Gas (LNG) Regasification project at Mundra, Kutch, in Gujarat. The project is scheduled to be completed by October 2016. IHI Corporation, Japan, was last year awarded EPC contract to construct two LNG storage tanks at the Mundra LNG Terminal each having a net storage capacity of 160,000 cubic meter.

Sources in GLL said that they were in discussion with Dahej SEZ units of ONGC Ltd with 1.3 MMTPA and Torrent Energy Ltd with 1.4 MMTPA demand respectively. Further, talks were on with Mangalore SEZ which had demand of 1.1 MMTPA to meet their SEZ based gas demand.

“LNG receiving terminal can only be established at a port area. Due to huge investment requirement, such terminals cannot be established at every SEZ where demand exists. It is beneficial if the infrastructure is built at one SEZ area and other users within the same SEZ, other SEZs and outside SEZs can make use of these facilities,” they added. Most of the necessary infrastructure like pipeline network for supply of gas to Dahej SEZ was already in place, sources further said.

They further said that they have all the necessary environment and coastal regulatory zone (CRZ) clearance from the ministry of environment and forests, besides green signal from the Competition Commission of India (CCI). GLL is awaiting formal approval from the Board of Approval (BoA) for SEZ on its request for becoming co-developer over 28 hectares of the APSEZ for development, operation and maintenance of specific infrastructure facilities that is LNG Terminal, storage and re-gasification facilities and related facilities.

GLL was set up in 2007 to develop a LNG receipt, storage and regassification terminal at Mundra in Gujarat. The Rs 3,500 crore project will have initial capacity of 5 MMTPA with provision to expand to 10 MMTPA and ultimate expansion shall lead to capacity of 20 MMTPA. The 5.0 MMTPA LNG terminal is designed to have a berth for receiving LNG tankers of sizes 75,000 cubic meter to 260,000 cubic meter, two LNG storage tank, facilities for regasification and gas evacuation facilities to name a few.

Currently, there are two LNG terminals in the state- one at Hazira in south Gujarat and the other at Dahej with combined capacity of over 13 MMTPA. Besides, Mundra another LNG terminal is proposed at Pipavav port, which will have 2.5 MMTPA to 5 MMTPA capacity.