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Petronet: positioning gas for growth

Jul 26, 2000

The demand for natural gas in India is far in excess of the supply. Currently, domestic production is insufficient to meet the total requirement. In the medium term the shortfall in domestic supply is likely to be met by imports. For the import of natural gas requisite infrastructure will have to be set up. The Government to fulfill this objective is setting up import terminals in the country. This task has been entrusted upon Petronet LNG. Oil & Natural Gas Corp. (ONGC), Gas Authority (GAIL), Indian Oil (IOC) and Bharat Petroleum (BPCL) have promoted the company.

Petronet LNG will be setting up terminals at Dahej, Gujarat and Kochi, Kerala. The terminals will have a capacity of 5 m & 2.5 m tonnes respectively. The Dahej terminal is expected to commence operations by 2002 at a cost of Rs 22.5 bn. The gas from the terminals is to be supplied to power, fertiliser and industrial units.

The marketing and supply rights for the Dahej terminal have been bagged by IOC and GAIL while for the Kochi terminal BPCL and GAIL have acquired these rights. The operation and maintenance (O&M) contract for both the terminals are likely to be given to ONGC.

Besides the setting up of terminals, pipeline infrastructure will have to be created for the transmission of gas. Petronet is forming separate joint ventures for setting up pipeline infrastructure in different parts of the country. With a transmission network in place the demand for gas should pick up further.

Several private sector initiatives are also in the offing. However, Petronet is taking the lead in ensuring the gas sector meets its growth trajectory.

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