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P. Manoj

New Delhi , Jan. 18

GLOBAL LNG shipping majors such as Malaysia International Shipping Corp, Mitsui O.S.K. Lines, Teekay Shipping, Qatar Shipping, Exmar and domestic players such as Shipping Corp, Great Eastern, Varun and Essar are among those who have submitted their request for qualifications (RFQ) for the proposed LNG shipping contract of Petronet LNG Ltd (PLL).

The last date for submission of RFQs ended on Monday. A consortium of Japanese shipping lines comprising Mitsui O.S.K. Lines-NYK Line-K Line has tied up with state-run SCI to bid for the $600 million (Rs 2,623 crore) project to build and operate three LNG tankers of 1,38,000 to 1,65,000 cubic metre capacity.

SCI has also joined hands with Qatar Shipping Company (Q Ship) to bid for the project, a top SCI official has confirmed.

As per the tender terms, a foreign shipping company can bid in consortium with only one Indian entity while a domestic company can bid in more than one consortium of foreign partners.

Malaysia International Shipping Corporation Bhd, the world's largest carrier of LNG, has teamed up with Great Eastern Shipping Company Ltd. MISC is a unit of Malaysia's national oil and gas company, Petroliam Nasional Bhd (Petronas) which owns 62 per cent stake in MISC.

G.E. Shipping has also forged a tie-up with Teekay Shipping Corporation based in Nassau, The Bahamas. Teekay Shipping Corp had recently floated a wholly-owned subsidiary in the Marshall Islands christened Teekay LNG Partners L.P. as part of the company's strategy to expand its operations in the LNG shipping sector.

Varun Shipping Company Ltd has also submitted a RFQ in consortium with the Belgian natural gas shipping company, Exmar. Belgium's Saverys family owns a little more than 50 per cent in the Antwerp-based Exmar, which is now a separate company listed on Euronext, Brussels after its June 2003 de-merger from parent shipping company CMB.

Essar Shipping Ltd has also entered the race for the project. A top Essar Shipping official told Business Line that the company has bid for the project on its own without a foreign partner. "We have not named any foreign partner right now. We are qualifying for the tender on our own and are capable of handling the contract ourselves," he stated.

PLL will hire three tankers from the successful ship owning and operating consortium on long-term time charter basis to ship LNG to its soon-to-be expanded Dahej terminal and the proposed greenfield terminal at Kochi.

With none of the domestic companies meeting the three-year experience in ownership, operation, technical management and crewing of LNG tankers of similar capacity stipulated by PLL, they have to tie-up with an experienced foreign LNG tanker operator to become eligible for bidding.

On the other hand, foreign LNG ship operators will have to compulsorily take on an Indian shipping entity to comply with the guidelines issued by the Director General of Shipping on grant of permission for chartering LNG vessels into the country.

As per the norms, licence for chartering LNG vessels will be contingent upon the tankers flying the Indian flag with an Indian entity owning the ship either wholly or an Indian partner owning not less than 26 per cent of the company that owns the LNG carrier.

For the first phase of the Dahej terminal project, PLL had hired two LNG tankers of 138,000 cubic metre capacity each from a consortium of Mitsui O.S.K.Lines-NYK Line-K Line-SCI at a charter hire rate of $68,900 per day for each of the two tankers named Disha and Raahi. Q Ship also has a 15 per cent stake in each of the two tankers.

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