Kakinada Seaports and Royal Dutch Shell will form a joint venture company with Reliance Power in order to set up an LNG terminal with an initial capacity of up to 5 million tonne per annum (mtpa) by 2014 at Kakinada deepwater port in Andhra Pradesh.
The information was revealed by a joint statement of the three companies. Kakinada Seaports operates the Kakinada deepwater port. Shell already controls and operates LNG import terminal in Gujarat.
The proposed terminal will help Reliance Power secure fuel supplies for its 2,400 mw gas-fired project at Samalkot in Andhra Pradesh. Reliance's plant and another 5,000 mw power project are almost ready in India but can't operate because of a local gas shortage.
India's gas-based plants are facing uncertainty over supply as output from the D6 block off India's east coast operated by Reliance Industries has sharply declined, forÂcing power producers to look for substitutes.
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