Lloyds List: Petronet prepares to tie up Gorgan deal: “The Australian company would arrange for the supply of LNG through a consortium, in which the stakeholders are Chevron, ExxonMobil and Shell.”: Wednesday December 28, 2005

INDIAN government-owned Petronet LNG has decided to finalise a deal next month with Australia's Gorgan Projects, for the supply of liquefied natural gas to its proposed 2.5m tonnes per annum gas receiving terminal, to be commissioned in Kochi, Kerala, by 2009, writes Shirish Nadkarni in Mumbai.

The Australian company would arrange for the supply of LNG through a consortium, in which the stakeholders are Chevron, ExxonMobil and Shell.

'Discussions with Gorgan Projects are at an advanced stage,' said Sham Sundar, Petronet's director (technical). 'The price and total quantity of LNG to be bought will be finalised in the final round of discussions in January.'

Although the terminal is slated to have an initial capacity of 2.5m tpa, it would be subsequently enhanced to 5m tpa, depending on the local demand for the gas. Taking this potential into consideration, the storage tank to be built here would have a capacity of 5m tpa.

'For the transportation of LNG from Australia, we will order one more ship from any shipping company that offers us the best price,' Mr Sundar said. 'In any case, a decision on this will only be taken after the deal with the LNG suppliers is finalised.'

The lowest bidder for carrying LNG from Ras Laffan Gas, Qatar to the Dahej terminal is the consortium of SCI, along with its partners MOL, NYK Lines and K Line, Mr Sundar said.

The other bidder is the consortium of Great Eastern Shipping Co with the Teekay group. These two consortia had submitted fresh bids as asked for by PLL, following the government's decision to allow the chartering of foreign-flag vessels for import of LNG.

'The EPC contract for the terminal here will be awarded by March 2006,' Mr Sundar said.

'Issues relating to the formal handing over of 35 hectares of land at Puthuvypeen, where the terminal is to be set up, have been sorted out.' 

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