IndianOil calls bids for construction of LNG terminal
New Delhi   30-Mar-2013

State-owned IndianOil has called for bids for the construction of 5 million tonne a year liquid gas import terminal at Ennore in Tamil Nadu.

IndianOil is seeking Expression of Interest proposals for a lump-sum engineering, procurement and construction contract for the Rs 4,320 crore liquefied natural gas (LNG) import and re-gasification terminal.

Interested contractors have to submit EoI by April 16, the tender document said. The company plans to build the Rs 4,320 crore LNG import facility at Katupalli (Ennore) by 2016. The terminal will have an initial capacity of 5 million tonne per annum which can be expanded to 10/15 million tonne in future.

Tamil Nadu Industrial Development Corporation (TIDCO) may take a 5-10 per cent stake in the project in which IndianOil will hold majority stake.

IndianOil may offer 26 per cent stake in the project to a LNG supplier like Gazprom of Russia in lieu of gas supplies, industry sources said.

Ennore will be the third LNG terminal on the east coast with state-owned gas utility GAIL India building a facility at Kakinada in Andhra Pradesh and Petronet LNG Ltd setting up a 5 million tonne facility at Gangavaram in Andhra Pradesh.

Royal Dutch Shell also plans to set up a floating LNG terminal at Kakinada.

LNG is a natural gas that has been cooled down to liquid form, taking up just 1/600th of the volume in its gaseous state for ease of transportation by sea.

"To qualify bidders must have successfully completed an EPC contract for an LNG re-gasification terminal with minimum capacity of 2.5 million tons per annum or LNG liquefaction facilities of minimum capacity of 2.5 million tons during the last 10 years," the tender document said. The bidder, having a minimum annual turnover of $200 million during last three years and a net worth of at least $55 million, should have carried on its own design, engineering, procurement, construction, commissioning and project management for these facilities.

IndianOil also plans to lay 1,175 km of pipelines to transport gas imported at the Ennore LNG terminal to consumers.

The company had on January 18 submitted an Expression of Interest (EoI) to sector regulator Petroleum & Natural Gas Regulatory Board (PNGRB) for laying natural gas pipeline from Ennore to Nagapattinum in Tamil Nadu with spurlines to Madurai, Tuticorin and Bengaluru. IndianOil, which operates 10 of India's 22 refineries and has a 30.8 per cent share of the nation's 213.18 million tonne per annum refining capacity, plans to invest Rs 56,200 crore during the 12th Plan (2012-17). Of this, Rs 3,592 crore is earmarked for diversification projects like LNG terminals.