The Hindu Business Line : PLL may divert 2.5 mt gas meant for Kochi to Dahej

PETRONET LNG Ltd (PLL) is understood to be in the process of diverting 2.5 million tonnes of LNG from RasGas, Qatar, meant for Kochi, to its Dahej terminal, expansion of which is on the anvil from the present 5 million tonnes to 7.5 million tonnes.

The PLL liability for Kochi, according to the SPA with RasGas, Qatar, would be obligatory only after development and implementation of Kochi terminal and the future of this project still hangs in balance, official sources said.

Where as, expansion of Dahej terminal would take about one year while it would take at least three years to complete the Kochi terminal.

A final decision on implementing this project, which has been pending for about 5 years, is yet to emanate and it would materialise only after getting an assured market which could absorb at least 60 per cent of the 2.5 million tonne per annum capacity of the terminal, they said.

The idea, according to reliable sources, was to utilise the LNG from RasGas to meet the growing demand in the North. By the time the Kochi terminal is completed, PLL could bring in gas from RasGas or from Iran, they said.

However, when contacted Mr S.C. Mathur, Chairman and Managing Director, PLL, told Business Line that the company has yet to get the approval for expanding the Dahej project.

He said that gas would be brought to Kochi when the terminal is completed as "we have this commitment". There won't be any diversion of LNG meant for the terminal here, he said adding quickly "GAIL and IOC were negotiating with Iran for buying 5 million tonne of LNG from there".

Mr Mathur said that absence of an assured market of 60 per cent had been delaying the implementation of the project, despite having obtained all the required clearances and approvals and incurring an investment of about Rs 32 crore in pre-project activity. But, so far no firm long-term agreements with the potential buyers have been reached.

On the offer of Kochi Refineries Ltd (KRL) to participate in the terminal project, Mr Mathur said "we have asked KRL to quickly firm up with BPCL", which is the parent company of the refinery and a stakeholder in PLL.

According to Mr B.K. Menon, Managing Director, KRL, his company had told PLL that it was willing to participate in equity besides becoming a consumer.

Also, if necessary "we could take up marketing and operating the terminal on contact basis", he said.

Meanwhile, the ONGC terminal project proposed to be set up at Mangalore, which has got the green signal of the Union Government, with a total capacity of 12 million tonne, might become operational by 2008. If at all the terminal project here takes off next year, it would also become operational only by 2008.

By that time, the capacity of the Dahej terminal project might also be raised to 10 million tonnes. Given this scenario, Kerala might be deprived of the LNG terminal here, the sources added.

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