Behind the ‘world’s first CNG terminal’ at Bhavnagar, Gujarat

The Bhavnagar port is in close vicinity to the Dholera Special Investment Region (SIR) and is expected to serve the industries that set up base in the region.

An artist's impression of a container at Bhavnagar port in Gujarat.

An artist's impression of a container at the Bhavnagar port in Gujarat. (Image via Twitter/@narendramodi)

4 min readAhmedabadSep 29, 2022 06:28 PM IST First published on: Sep 29, 2022 at 04:19 PM IST

Prime Minister Narendra Modi laid the foundation stone for the “world’s first CNG (Compressed Natural Gas) terminal” at Bhavnagar in Gujarat on Thursday (September 29). This is a three-year-old project that is expected to infuse Rs 4,000 crore in developing the existing port infrastructure at Bhavnagar. In a tweet, before his ongoing two day-visit to Gujarat began, the PM said: “Bhavnagar is all set to get a CNG terminal and brownfield port project. The economic benefits of these would be immense”.

The city of Bhavnagar has a glorious history and exceptional culture. At a programme in Bhavnagar, development works worth Rs. 5200 crore will either be dedicated to the nation or their foundation stone would be laid. These works are linked to energy, water supply and ports.

— Narendra Modi (@narendramodi) September 28, 2022

The seeds for the CNG terminal

The idea for the project materialised during the January 2019 Vibrant Gujarat summit when a consortium of London-based Foresight Group, Mumbai-based Padmanabh Mafatlal Group and Rotterdam-based Boskalis signed a Memorandum of Understanding (MoU) with Gujarat Maritime Board (GMB) for development of the CNG terminal.

In December 2019, a project proposal for the development of the north side of Bhavnagar port and allied infrastructure, which includes a CNG terminal, was submitted. This was accepted and GMB issued a Letter of Intent (LoI) in September 2020 in the name of Bhavnagar Port Infrastructure Pvt Ltd, a special purpose vehicle formed by the consortium.

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While the consortium will invest Rs 4,000 crore in developing the north side of the Bhavnagar port under the BOOT (Build, Own, Operate and Transfer) policy of the state government, state-run GMB will continue to operate the berths on the south side of the port.

Why is the Bhavnagar port important?

The Bhavnagar port is in close vicinity to the Dholera Special Investment Region (SIR) and is expected to serve the industries that set up base in the region. It is already connected to the northern hinterland through a railway line that extends to the existing berths at the port.

When is the CNG terminal expected to commence operations?

The construction is expected to commence in the first quarter of 2023 after GMB approves the Detailed Project Report. It is expected to be made operational by 2026. The proposed port terminal’s capacity is 4.65 Million Tonnes Per Annum (MTPA), of which the capacity of the CNG terminal will be 0.3 MTPA.

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Special lock-gate system at Bhavnagar port

As per the LoI, the consortium will repair and redevelop the tidal lock gate system, which officials say will be the fourth largest such system in the world. Traditionally, because of the higher tidal range of approximately 10 meters, Bhavnagar creek attracts a significant amount of sediment in the form of silt. This lock gate system has been set up so that a minimal amount of sediment enters the port basin during high tide, thus bringing down the cost of dredging inside the port substantially.

Other facilities that will accompany the CNG terminal

While the CNG terminal will be part of the existing Bhavnagar port, additional facilities like an ultra-modern container terminal, multipurpose terminal (LPG and Chemical), a Ro-Ro (roll-on/roll-off) terminal for cargo ships that can load and unload wheeled objects such as trolleys and cars, and a liquid cargo terminal will also be developed by the private consortium.