Decks cleared for LNG terminal

: In a major development, Andhra Pradesh Gas Distribution Corporation, GDF Suez, Shell and GAIL have announced signing of two separate memorandums of understanding (MoUs) for LNG terminal at Kakinada deep water seaport.

The first MoU was signed between the APGDC, GDF SUEX and Shell and it supports the development of the terminal. APGDC (a joint venture of State government and GAIL) will have 48 per cent equity in the project while GDF SUEZ and Shell will have 26 per cent each. The second MoU is signed between GAIL, GDF SUEZ and Shell and it covers both the sourcing of the LNG and the marketing of the regasified LNG from the terminal. GAIL, GDF SUEZ and Shell will have 48 per cent, 26 per cent and 26 per cent equity in the project respectively.

The MoUs were signed in the presence of Chief Minister N. Chandrababu Naidu, Union Minister P. Ashok Gajapati Raju and Ministers of State Dharmendra Pradhan and Y.S. Chowdary, GAIL said in a filing made to the BSE.

The Kakinada LNG terminal would use the state of the art Floating Storage and Regasification Unit (FRSU) with a peak capacity of five million tonnes a year with a provision to double the capacity.

The proposed terminal would use high end technology and would be the first of its kind in the country. Kakinada port was found suitable for the project owing to its availability of natural break-water in the Hope Island a barrier that protects against the impact of the high seas. The project would provide additional revenue to the State to the tune of about Rs 1,700 crore and employment (direct and indirect) for about 2,000 people.

The Chief Minister asserted that the government was fully committed to the project. Domestic and international partners who have come together under the MoU would bring the best expertise technology and speediness from across the world to complete the project within 18 months.

He said Kakinada LNG terminal was a great opportunity in the development of a project that would ensure continuous availability of natural gas.

Asserting that FRSU-based LNG project was the most cost effective way to secure energy supply while bolstering the fight against climate change and pollution, he said gas was the way to go as it dovetailed concerns about climate change. Mr. Naidu said opportunities for scaling up the project were huge.

GAIL (India) Chairman and Managing Director B.C. Tripathi said this was the first of its kind LNG terminal in the country and would prove to be an important infrastructure for import of LNG. Mr. Dharmendra Pradhan said the project would be a significant boost to the economic churning and development.

Shell Companies in India chairman Yasmine Hilton and GDF SUEZ Energy CEO (South Asia, Middle East and Africa) Lucas Hautvast spoke.

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Decks cleared for LNG terminal