The Hindu Business Line : Petronet LNG comes out of red — Eyes equity participation in LNG plants abroad

ENTHUSED by its performance for the first quarter of 2005-06, Petronet LNG Ltd (PLL), the country's largest liquefied natural gas (LNG) importer, today unveiled its ambitious expansion plans.

The company is not only looking at equity participation in LNG plants in gas exporting countries, but also plans to invest Rs 4,000 crore in doubling its Dahej LNG terminal capacity and setting up a new import terminal at Kochi.

Speaking at a press conference, Mr Suresh Mathur, CEO and Managing Director, PLL, said: ``The company sees its net profit for the year ended March 2006 at more than four times the Rs 39.13 crore-posted in the first quarter of the fiscal.'' PLL has come out of the red with a Rs 39.13-crore net profit for the quarter ended June 30 and projected a profit of Rs 200 crore for the financial year 2006.

PLL had reported a net loss of Rs 19.57 crore in the first quarter of 2004-05. The company's turnover more than doubled to Rs 921.24 crore in first quarter of 2005-06 as against Rs 388.36 crore in the corresponding period last year. PLL had posted a net loss of Rs 28.45 crore on sales of Rs 1,945.26 crore in financial year 2005.

On an optimistic note, Mr Mathur, said that the turnover is expected to more than double to over Rs 4,000 crore as the company's import of LNG from Qatar has doubled to 5 mt from April 2005.

The company was looking at importing 6-6.25 mt of LNG during the current year. ``We have contracted supplies for 5 mt in 2005-06 but we are seeking additional spot cargoes,'' he said.

Mr Mathur said the company, in addition to the LNG terminals at Dahej and Kochi, would also participate in liquefaction and shipping contracts with its promoters - IOC, ONGC, BPCL, and GAIL (India). When asked whether it would be an equity participation, Mr Mathur, stated that ``we plan to participate in liquefaction plants (where gas is converted into liquid for transportation through ships) in countries where our promoter firms are seeking to import LNG.''

On the target range of the equity participation, Mr P. Dasgupta, PLL Director (Finance), said the participation would not be less than 20 per cent and could be as high as 50 per cent.

``We can import and regassify up to 6.25 mt of LNG at Dahej through minor de-bottlenecking. We are seeking short-term supplies of 1.25 mt,'' Mr Dasgupta said, adding that Qatar, Oman and Abu Dhabi were the potential suppliers.

Speaking about the expansion plans, Mr Mathur said, the company was doubling the capacity of its Dahej LNG terminal to 10 mt per annum (mtpa) using economies of scale. Besides, Petronet was also setting up a LNG receiving and re-gasification terminal at Kochi with a capacity of 2.5 mtpa, scaleable up to 5 mtpa.

To fund its expansion project, the company does not propose to dilute its present equity structure.

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