Petronet to form JV with Japanese, Sri Lankan firms for LNG plant

Petronet LNG, India’s largest LNG importer will set up an LNG terminal in Sri Lankan capital Colombo in a joint venture with Sri Lankan and Japanese companies.

The matter was under discussion since last year. During the visit of External Affairs Minister Sushma Swaraj to Colombo on September 1, the Sri Lankan government issued a Letter of Intent.

“A joint venture of Petronet LNG Limited along with Japanese and Sri Lankan companies will develop an LNG Terminal in Sri Lanka to provide regassified natural gas to various power plants, domestic and transport sectors in Sri Lanka. The capacity of the LNG Terminal will be decided upon the gas demand in Sri Lanka and is expected to be developed in 2 years after completion of initial formalities,” said a public statement by the company.

Petronet said the LNG terminal would be set up on the western coast of Sri Lanka in close vicinity of Colombo where most of the power projects (operating mainly on costly liquid fuel) are located. The Colombo Metropolitan Area is inhabited by more than 5 million people or roughly 25 per cent of the total population of Sri Lanka generating over 50 per cent of the GDP.

"The LNG terminal near Colombo would improve the economics of various power plants and also generate immense direct and indirect benefits for vast majority of Sri Lankan people," the statement said.