IOC in talks with Dhamra for LNG terminal
New Delhi   15-Dec-2011

IndianOil (IOC) is in talks with L&T and Tata Steel-owned Dhamra Port for setting up a 5 million tonnes a year LNG terminal in Orissa, the firm’s director incharge of new businesses has said.

The LNG import and regassificiation facility at Dhamra port will be besides the Rs 4,320 crore terminal IOC is planning to set up at Ennore in Tamil Nadu, the firm’s director (business development), AMK Sinha, said here.

“We are looking at the possibility of setting up a LNG import facility at Dhamra port to meet gas demand in Orissa and West Bengal. Our refineries at Paradip (in Orissa) and Haldia (in West Bengal) alone need 2.5 million tonnes of LNG,” he said.

Situated between Haldia and Paradip, the port at Dhamra will be one of the deepest ports of India with a depth of 18 metres, which can accommodate super cape-size vessels up to 180,000 dwt. Dhamra Port, a 50:50 joint venture of L&T and Tata Steel, has been awarded a concession by government of Orissa to build and operate the port. Sinha said IOC has begun work on the proposed LNG import facility at Ennore. “We have awarded the contract for front-end engineering and design (FEED) study Foster Wheeler.” IOC had in 2007 put on hold the 2.5 million tonnes a year LNG import-cum-regassification terminal after huge gas finds off the east coast made the project economically unviable.

But the output from Krishna Godavari basin fields falling short of the target, LNG imports are being talked as an alternative to meet the demand.

IOC and its subsidiary Chennai Petroleum (CPCL) would be the lead promoters of the Ennore project.

Interestingly, Petronet LNG, the nation's largest liquefied natural gas importer, too is looking at setting up a LNG import terminal on the east. Petronet is looking at sites in Orissa and Andhra Pradesh for its third terminal. IOC is an equal promoter of Petronet along with Gail India, ONGC and Bharat Petroleum.