Krishnapatnam Port Company has inked a pact with Petrogas Pvt Ltd and the Andhra Pradesh government to set up an LNG regassification terminal.
"Petrogas will commit a direct investment of Rs 3,000 crore at Krishnapatnam, Nellore district, Andhra Pradesh, in the fields of LNG regassification terminal and allied industries," the company said in a statement today.
The memorandum of understanding (MoU) between Krishnapatnam Port, the state government and Petrogas -- a JV of Isomeric Holdings Sdn Berhad and Vijayawada-based LEPL Ventures Pvt Ltd -- was signed in the presence of Andhra Pradesh Chief Minister Chandrababu Naidu.
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"The LNG terminal will use a state-of-the-art floating storage and regassification unit (FSRU) with a minimum capacity of 5 million tonnes per annum (mtpa), which shall be doubled to 10 mtpa in another three years," the company said.
The commercial operations for the project will commence within three years and is expected to create more than 500 jobs.
Krishnapatnam Port Company MD Chinta Sasidhar said, "The project is ambitious and we are proud to contribute to this opportunity... The infrastructure story of Andhra Pradesh is set on a promising horizon and projects of such scale will only provide a significant boost to the country's trade potential, apart from creating immense job opportunities."
Krishnapatnam Port, promoted by the Hyderabad-based CVR Group, is an all-weather, deep water port on the east coast of India in the Nellore district of Andhra Pradesh.
The port with a transit storage area of 6,800 acres has the country's largest waterfront area of 161 sq km, and a depth of 20.5 metres, the company said.
Its current draft of 18.5 metres can accommodate full-sized cape vessel of 200,000-tonne capacity.
Krishnapatnam Port Company Ltd (KPCL), which was formed with the mandate from the Andhra Pradesh government on BOST (build-operate-share-transfer) concession basis for 50 years, is being built in three phases and currently, the second phase is under way.
(REOPENS DCM 82)
LEPL, which is into real estate and infrastructure, runs Air Costa Airlines.
"The Andhra Pradesh government will facilitate necessary support from the department of energy, infrastructure and investments to establish the project. It will facilitate granting necessary permission to public hearings (if needed) to obtain the relevant environment clearances," the MoU document added.
Petrogas and Krishnapatnam Port will enter a separate agreement on port services to execute the project, the MoU further said.
(REOPENS DCM 83)
"Petrogas will construct 5 mtpa capacity regassification and storage plant and related ancillary facilities like floating LNG storage tanks, regassification unit etc in phase I, which is expected to cost USD 500 million," D V Krishna Kumar, CEO, Power of LEPL Projects, said.
"Petrogas is in touch with Petronas to be a strategic partner, keeping the interest of both Malaysia and Andhra Pradesh population."
Sadacharamani Govindasamy, MD of Isomeric Holdings, Malaysia, said: "With a futuristic thinking and under phase 2, we plan to build another 5 mtpa capacity RGT and can supply gas to industrial and commercial needs of Andhra Pradesh.""
He further said they are in talks with banks like Deutsche Bank, ICICI Bank and BNP Paribas, which have shown interest in financing the project.
