Kochi LNG terminal delayed again, likely by next year

It was earlier decided to commission the Rs 4,600-crore project in this year itself

The commissioning of the LNG terminal at Puthuvype, near here, is likely happen only by next year. This is because of the slow pace in the marketing arrangement of LNG in the southern states and in the construction of the pipeline network.

Earlier it was decided to commission the project in this year itself.

“The pre-commissioning of the project is likely to be done this month. From our side there is no delay, but we are not bringing in LNG right now. The formal commissioning can be done only after the marketing arrangements are set in. Otherwise gas cannot be pumped. This is being done by GAIL,” said a senior official of Petronet LNG, which is constructing the terminal.

However, the official said construction would be completed by the end of this month. Though there is no specific decision over the timing of the commissioning, it might happen in January-February.

The terminal’s capacity utilisation largely depends on the pipeline connectivity, construction of which has slowed down due to land-related issues. The two major pipelines — from Kochi to Mangalore and Kochi to Bangalore via Tamil Nadu -- would be ready in 2013-14.

The terminal will have a capacity of 5 mtpa, though initially, it would handle 2.5 mtpa.

The first phase of the Rs 4,600-crore project will operate at a rate of 0.50 million to 0.75 million tonne for a year and gradually volumes would be ramped up. The total handling capacity would be raised to 15 million tonnes by 2014, including 10 million tonnes at the Dahej unit, in Gujarat, the company said.

Petronet had started construction work on the project in 2007 and it was originally scheduled to be commissioned in 2009-10.

The company has also signed an agreement with Exxon Mobil Corporation for supply of 1.5 mtpa LNG from the Gorgon LNG project, Australia, on a long-term basis for the Kochi terminal. Petronet has already tied up 7.5 mtpa of LNG with Ras Laffan Liquefied Natural Gas Company Limited (RasGas), Qatar, on a long-term basis.

Meanwhile, the first phase of the gas distribution network of Kochi terminal was launched last month with a 43-km pipeline from Puthuvype to Udyogamandal and Udyogamandal to Ambalamugal. Companies like FACT, Nitta Gelattin and BPCL can now receive LNG through the pipeline.

Work on the 505-km pipeline from Kochi to Mangalore will start soon. Upon completion, seven districts from Ernakulam to Kasaragod will benefit.

LNG will be made available to the NTPC project at Kayamkulam through pipelines that would be laid along the seabed. Brahmapuram and Cheemeni power projects in Kerala can also look forward to using LNG as fuel.