LNG terminal up but no sign of pipeline

The slow pace of laying of the inter-state pipeline, and the delays in signing up for marketing tie-ups for the sale of natural gas is likely to delay the commissioning of the Petronet LNG Terminal at Puthuvype near here.

The project was earlier scheduled to be completed by the year-end and later re-scheduled to next January. But the inordinate delay in marketing arrangements and in the pipeline work on Kochi-Mangalore and Kochi-Bangalore stretches now face serious concerns not only on the commissioning, but even the viability of the Rs 4,300 crore project. The terminal is ready to receive LNG by January, 2013. Phase II of the 900 km GAIL pipeline to Mangalore and Bangalore which involves an investment of Rs 3,400 crore is badly held up, said top officials of the Cochin Port Trust (CPT), GAIL and Petronet LNG.

C Unnikrishan Nair, traffic manager, CPT, and V Ketarpal, senior vice president, Petronet LNG, said only 4 km of the 900 km pipeline was in place.

Some 505 km of this pipeline passes through Kerala, 310 km through Tamil Nadu and 85 km through Karnataka. It passes through seven districts in Kerala and the vital issue was land acquisition and public protest against the pipe laying work.

If the work was to progress, dedicated monitoring from the state administration and close follow-up by the district collectors was required, said Remesh, deputy general kanager of GAIL. Adequacy of compensation and timely payments were the key issues in the case of land acquisition. Only 10 per cent of the market value of land can be paid to the land owner under Section 10(4) of the Petroleum & Minerals Pipelines (Acquisition of Right of User in Land) Act.

This causes serious consternation among the owners as land prices are pretty high in Kerala on Sunday.

The state is considering a proposal to issue a direction that the market value for this purpose shall be three times of the fair value; but the issue is pending. The state is helpless as the pipeline passes through all the northern districts, except Wayanad. Though agriculture and related activities are possible over the land building construction would not be possible.

GAIL has reduced the width of the land required under Right of Use (RU) from 20 metres to 10 metres. They said that public resistance could be reduced if BPCL can be persuaded to allow the LNG pipeline to be laid along the product pipeline from Kochi to Karur owned by Petronet. If the above issues are sorted out, pipelines can be completed in a year, they added.