Work on LNG terminal in M'lore to begin in Nov

Feasibility study likely to be submitted within a month: M Veerappa Moily, minister for petroleum and natural gas

Work on the new LNG (liquefied natural gas) import terminal at Mangalore will begin in November this year, said M Veerappa Moily, minister for petroleum and natural gas.

The consortium of ONGC, BPCL, Mitsui and New Mangalore Port Trust (NMPT) are carrying out a feasibility study for a terminal with a capacity of 2-3 million tonnes per annum. The report is likely to be submitted within a month, he said.

Speaking after launching the sale of 5-kg LPG cylinders and LPG portability in Bangalore on Saturday, he said Gas Authority of India Limited (GAIL) would complete the detailed survey for extending the Dhabol-Bangalore gas pipeline to Mangalore. It is proposed to lay the pipeline between Chitradurga and Mangalore, he said.

The Memorandum of Understanding (MoU) was signed by ONGC, Bharat Petroleum Corp Ltd (BPCL), Mitsui of Japan and NMPT for the LNG terminal at Mangalore in March this year. The terminal will have an initial capacity of 2-3 million tonnes, which can be expanded to 5 million tonnes later.

The ONGC-led consortium is expected to complete the project by 2018. The first phase of the terminal will cost $500 million to $750 million.

Mangalore is already home to a 15-million tonne refinery set up by ONGC and required infrastructure is available at New Mangalore Port to handle LNG cargo.

Moily said GAIL had also extended financial help to the Karnataka government for setting up infrastructure to handle compressed natural gas (CNG) in Bangalore city. "We have sent a proposal to the state government extending our help for setting up CNG infrastructure. If the state government is ready to buy CNG-run buses for Bangalore city, we can supply them CNG immediately. This will help in reducing pollution in the city of Bangalore, and has already been achieved to a large extent in Delhi and Mumbai," he said.

GAIL has also offered to supply gas from its Dhabol-Bangalore pipeline to Bellary, where several steel plants are operating. He said GAIL was also ready to supply gas to Yelahanka power plant in Bangalore that is currently run on diesel.

"If the state is willing to convert the power plant from diesel to gas, it can save Rs 800 crore annually. We are ready to supply gas anytime," Moily said. The Centre is also committed to make Bangalore district kerosene-free by supplying cooking gas to domestic households through a pipeline, the minister added.