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Petronet LNG: Street may await clarity over possible policy changes

There is 95-100 per cent utilisation at Petronet's Dahej terminal whereas other terminals are under-utilised

The idea is not new. State-run Petronet LNG, India’s biggest LNG importer, has harboured plans of using the fuel in the transport sector for the past six years. But lack of government incentives and resistance from small transporters meant that thoug
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There is LNG regasification capacity of 47.7 mmtpa of re-gas capacity. (File Photo)

Devangshu Datta Mumbai

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A new consultation paper from the Petroleum and Natural Gas Regulatory Board (PNGRB), ‘Optimising LNG supplies from terminals in India’, indicates that Petronet LNG faces regulatory risk, due to the regulator wishing to control regasification tariff.  At the moment, these are levied by agreements between the operator and customer.  The change would require amendment to the PNGRB Act but may or may not occur. If it does, it reduces Petronet’s pricing power. If tariff regulation does occur, it may also inhibit investment into liquefied natural gas (LNG) terminals.  There is 95-100 per cent utilisation at Petronet’s Dahej terminal.