Petronet to take 4th LNG ship from Japanese shipping firms

New LNG tanker will haul the fuel from Gorgon in Australia to Kochi in Kerala where Petronet has built a 5 MT per annum LNG import and re-gassification terminal

Petronet LNG Ltd, India's largest buyer of liquid gas, has hired a fourth LNG ship from a consortium of state-owned Shipping Corp of India (SCI) and Japanese lines for $75,000-80,000 per day.

Petronet will hire a 173,000 cubic meters vessel from a consortium comprising of Mitsui OSK Lines Ltd (MOL), Nippon Yusen Kabushiki Kaisha (NYK), Kawasaki Kisen Kaisha Ltd (K Line) and SCI for 19 years beginning September 2016 to ferry liquefied natural gas (LNG).

The consortium already has leased three LNG ships to Petronet for hauling liquid gas (LNG) from Qatar to its Dahej terminal in Gujarat.

"We yesterday signed a time charter agreement with Petronet," NYK Group's Representative Director Hitoshi Nagasawa said on the sidelines of the 8th Asia Gas Partnership Summit here.

The new LNG tanker will haul the fuel from Gorgon in Australia to Kochi in Kerala where Petronet has built a 5 million tonnes per annum LNG import and re-gassification terminal.

SCI, NYK and MOL will each hold 26% stake in the consortium while K Line has the remaining 22%, he said adding Petronet has an option to take up to 26% stake in the shipping venture.

Petronet will exercise the option closer to the completion of ship building at Hyundai's Korean shipyards. Company officials said the Board of Directors have approved award of a long-term time charter for the vessel. The delivery of the vessel will synchronise with the start of LNG supply from Gorgon.

The shipping consortium had previously supplied three ships to Petronet - Disha, Raahi and Aseem. All the three ships are used to transport LNG from Qatar, with which Petronet has a contract for buying 7.5 million tonnes a year of LNG on a 25 year contract.

Petronet has 3% stake in one of the three consortia formed to ferry 7.5 million tonne per annum of LNG from Qatar to its Dahej terminal in Gujarat.

SCI holds 29.08% stake in 1,38,000 cubic metres capacity Disha and Raahi LNG carriers and 26% in 155,000 cubic meters capacity vessel named Aseem. Petronet has 3% stake in the consortium that operates Aseem.

Petronet will use the 1,74,000 cubic metres capacity vessel for 19 years to ship 1.44 million tonnes per annum of LNG it has contracted from Gorgon, Australia. Supplies from Australia will begin sometime in end July, while the consortium has committed to deliver the ship in September 2016.