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Hindustan Petroleum Corporation Ltd’s (HPCL) Chhara liquefied natural gas (LNG) import terminal in Gujarat will likely begin operations in the next couple of months, with six to seven companies in talks to hire capacity at the facility, the public sector firm’s Marketing Director Amit Garg said Thursday.
Located in Gir-Somnath district, the Chhara LNG terminal, which will have a capacity to import and regasify 5 million tonnes per annum (mtpa) of LNG, marks the public sector refiner and fuel retailer’s entry in the natural gas business. The other two public sector fuel retailers — Indian Oil Corporation Ltd (IOCL) and Bharat Petroleum Corporation Ltd (BPCL) — are already in the LNG business as two of the four promoters of India’s largest LNG importer, Petronet LNG. IOCL also has its own LNG terminal at Ennore in Tamil Nadu.
An LNG import and regasification terminal is used to receive cargoes of natural gas that has been liquefied by being cooled at ultra-low temperatures, and then process the LNG to convert it back to the gaseous state, before dispatching it to consuming industries through pipelines. Although the Chhara terminal had achieved mechanical completion earlier this year, the commissioning was delayed as the pipeline to connect it to the existing gas pipeline network was not ready at the time. The 40-km pipeline is now nearing completion.
On being asked how much capacity at the terminal was HPCL likely to keep for itself, Garg said that the company had not taken a call yet. He also declined to name the “six to seven” companies that have approached HPCL to hire import and regasification capacity at the terminal. Earlier, HPCL was considering offering 3 mtpa of import capacity at Chhara terminal to other companies on lease, and keeping the remaining 2 mtpa for itself.
India’s natural gas consumption is expected to grow significantly over the next few years, in line with the government’s objective to increase the share of natural gas in the country’s primary energy mix to 30 per cent by 2030 from a little over 15 per cent at present. Given that the country depends on LNG imports to meet around half of its natural gas requirement, LNG imports are also set to rise substantially. Natural gas is used in sectors like power generation, fertilisers, and petrochemicals, among other industries. It is also used as a transportation fuel in the form of compressed natural gas (CNG) and as a cooking fuel in the form of piped natural gas (PNG).
India currently has seven LNG terminals with a cumulative capacity of 47.7 mtpa. The capacity is likely to rise substantially over the coming years as a number of new terminals are being planned, in addition to capacity expansion at some of the existing facilities.
