Dabhol gas terminal to go on stream in April

24 March 2009

India's largest gas distributor, the public sector GAIL (India) Ltd, plans to start operations at its Dabhol liquefied natural gas import terminal next month, and will allow other companies to to bring their cargoes in through the facilities for a  fee, a senior company executive said today.

The terminal, capable of handling five million tonnes a year, was set up in Dabhol to supply liquefied natural gas for the associated 2,150 mw Ratnagiri power plant - India's single-largest gas-fired generation unit.

However, the power plant itself has been struggling to reach full capacity because of a series of technical glitches. It may not need to import LNG as the government has allocated supplies from the gas to be produced by Reliance Industries Ltd. beginning next month.

"We have invited expressions of interest from companies interested in using the terminal," GAIL's finance director R.K. Goel said at an industry conference. The company has received responses from several companies including Essar Oil Ltd., GVK Power and Infrastructure Ltd, British Gas, Mahanagar Gas and state-run fuel retailers, he said.

Goel said that initially the LNG terminal would work at less than half the installed capacity, because it doesn't have a breakwater facility to defend ships from the weather and rough seas.

"Although they say it can work only at 20 per cent (of capacity) without the breakwater, we think it should be up to 40 per cent," he said. Constructing a breakwater could take years, and the company has yet to sign up any contractors for the project, Mr. Goel said.