Petronet LNG is working on a Rs 4,500 crore land-based LNG terminal project with facilities for receiving, storage and regasification of LNG at Gangavaram in Visakhapatnam district in collaboration with the Gangavaram port.
However, the initiative faces some headwinds as the local environmental activists protest against the 5-million tonne per annual (mn tpa) terminal project. It may be recalled that Petronet and Gangavaram Port signed a firm and binding term sheet for the development of the terminal in May 2012. Gangavaram Port will also have a stake in the project in exchange for the land it is providing.
Recently, the Chief Secretary Minnie Mathew urged the district administration to conduct a public hearing on the project. Following this, the hearing is being held and the Vizag district administration has made arrangements for the same at Gangavaram port.
The district administration was initially reluctant to conduct the public hearing due to opposition from local environmental activists on the pretext that the LNG terminal was not part of a port activity.
Petronet LNG is among the 3-4 players, including GAIL, planning to establish LNG infrastructure on the AP coast in view of large-scale unmet demand coming from power plants after the natural gas production in the K-G Basin fell by three fourths of the originally anticipated volume of 80 mmscmd.
The fall in the natural gas output had aggravated the power supply situation in Andhra and this forced the state to actively scout for developers of LNG terminals on the sea coast. Public sector GAIL is planning to set up a barge-mounted LNG terminal at Kakinada by the end of this year in a bid to bring LNG quickly to the AP coast to supply to the gas-power projects.
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