Consortium seeks to import LNG at Kakinada, India

A consortium led by Indian Oil Corp. (IOC) has put in a bid to develop LNG import facilities and related businesses at Kakinada port in Andhra Pradesh on India�s eastern coast.


MUMBAI�A consortium led by Indian Oil Corp. (IOC) has put in a bid to develop LNG import facilities and related businesses at Kakinada port in Andhra Pradesh on India�s eastern coast.

The four partners�IOC, Malaysian state oil and gas firm Petronas, CMS Energy Corp. of Dearborn, Mich., and India's Cocanada Port Co. Ltd.�would like to bring the LNG in at Kakinada and market the regasified product in Andhra Pradesh. IOC plans to hold the largest equity stake in the consortium (26%), while Petronas has committed to taking a 10% interest.

Petronas would supply the LNG from Malaysia, IOC would ship it, and Cocanada would develop the LNG terminal, ensure sufficient draught for vessels, and provide marine services at the port. Cocanada, through a concession agreement between Singapore-based International Seaports India Pte. Ltd. and the Andhra Pradesh state government, has been assigned a contract for the operation and maintenance of the deepwater Kakinada port. Cocanada reportedly has an understanding with CMS Energy regarding development of an LNG regasification facility at the port.

The four firms have commissioned a market survey to identify the profile of potential customers and ascertain the likely LNG demand in the region and the time frame for a buildup of such demand.

It is reported that BG PLC, Royal Dutch/Shell Group, and Enron Corp. have also approached the state government with a proposition similar to that of the IOC consortium. The proposal includes LNG receipt, storage, and regasification facilities at the port and distribution of natural gas through a pipeline to consumers in Andhra Pradesh and neighboring states.

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