The Hindu Business Line : Kochi LNG terminal may be delayed

THE future of the proposed Petronet LNG terminal here largely depends on the NTPC, the potential anchor customer, which would expand the capacity of its Kayamkulam Thermal Plant in Kerala by 1,950 MW in the 11th Plan.

Until Petronet LNG Ltd (PLL) is sure of securing a major anchor customer, it might not be able to go ahead with the project despite having received all the required clearances from the Central and State governments last year, for want of "an assured market," industry sources told Business Line.

The terminal, with an annual capacity of 2.5 million tonnes of LNG, is to come up on 40 hectares of land allotted by the Cochin Port Trust (CPT) at nearby Puthuvypeen. According to sources, the estimated cost is around Rs 1,600 crore. PLL had already obtained statutory approvals and clearances from the Kerala State Departments of Environments, Fisheries and Forests; the Chief Controller of Explosive for in-principal approval of layout; the Civil Aviation Authority and the Southern Naval Command. The latest clearance was received from the Union Ministry of Environment and Forests (MoEF) late last year, the sources said. Thus, most of the pre-project activities involving an investment of about Rs 30 crore have been completed. Further activities are on hold pending finalisation of consumers, they said.

The only pending issue which the company might pursue with the State Government is a sales tax waiver for five or 10 years or a cut in sales tax tariff for LNG supplied by PLL, the sources said.