The floating and processing unit of liquefied natural gas near Kakinada on the East Coast will be operational by December 2013 and significantly ease the pressure on gas supply in the region and for power projects.

S. Venkataraman, Director, Business Development, GAIL (India) Ltd, said the floating, storage and re-gasification LPG terminal when commissioned will help the gas-starved power plants in particular.

This project, taken up through a venture of Andhra Pradesh Gas Distribution Corporation, French company GDF Suez, and Gail Gas (part of GAIL) will have the capability to handle 3.5 million tonnes per annum of gas.

This is equivalent to 14 mmscmd. Typically, 1 mmscmd of gas is sufficient to power a gas plant of 220 MW. If the entire gas is used up by power plants, it will be adequate to support about 3,000-3,100 mw.

But the issue is whether independent power producers and others who need gas will be able to buy at the market-driven prices. The cost will include imported gas price, transportation cost, liquefaction and evacuation to site, he said.

Earlier, speaking at the CII event on natural gas, he said natural gas is emerging as the preferred fuel of choice to run power plants across the globe. But in India, barely about 10 per cent of the energy fuel demand is met by gas and this mix is expected to significantly go up in the next few years.

Referring to GAIL initiatives, he said that efforts are on to strike deals and enter into long-term supply contracts across the globe with local partners to ensure there is adequate supply of gas.

Towards this, GAIL has set up a subsidiary in Singapore apart from entering gas rich countries by setting up offices and a joint venture for shale gas.

“We also see Mozambique and Tanzania having huge potential to supply gas,’’ he said.

>rishikumar.vundi@thehindu.co.in

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