Torrent to use Petronet’s Dahej terminal for importing LNG
Torrent Power Ltd has signed an agreement to use Petronet LNG Ltd's Dahej import terminal in Gujarat to ship one million tons of LNG every year from 2017. Petronet, which is expanding its 10 million tons a year LNG import facility to 15 million tons by 2016-end and a further to 17.5 million tons in future, signed the agreement to lease out capacity to Torrent Power for 20 years.
"Petronet LNG Ltd and Torrent Power Ltd have executed long term capacity booking agreement for 1 million tons per annum from Dahej terminal for a period of 20 years starting in 2017," the company said in a stock exchange filing.
The agreement allows Torrent to use the Dahej terminal to import LNG contracted by it. While Torrent will tie-up the supplies from overseas sellers, Petronet will earn a tolling charge.
Petronet had previously signed similar capacity leasing agreements with state-owned gas utility GAIL India Ltd, Gujarat State Petroleum Corp (GPSC), Indian Oil Corp (IOC) and Bharat Petroleum Corp Ltd (BPCL).
It had leased 2.5 million tons per annum capacity to GAIL, 2.25 million tons to GSPC, 1.5 million tons to IOC and 1 million tons to BPCL.
Petronet Director (Finance) R K Garg said while GSPC has started using 1.25 million tons of the hired capacity, the rest will start using it once the expansion is completed.
The company currently buys 7.5 million tons a year of liquefied natural gas (LNG) from RasGas of Qatar on a longterm contract.
Besides blocking capacity for this volume, it is leasing out capacity to users, he said.
State-owned GAIL, IOC, BPCL and Oil and Natural Gas Corp (ONGC) hold 12.5 per cent stake each in Petronet LNG Ltd, the nation's biggest liquid gas (LNG) importer.
Petronet also has a 5 million tons a year LNG import terminal at Kochi in Kerala and is planning to set up a similar capacity terminal at Gangavaram in Andhra Pradesh.