India gets 1st US LNG shipment at Dabhol

The first liquefied natural gas (LNG) shipment from the US arrived at the Dabhol terminal of state-run gas major Gail here on Friday.

Receiving the first-ever shipment of 1.2 lakh tonne LNG under the long-term contract of 20 years, oil minister Dharmendra Pradhan also announced a Rs 700-crore investment by the newly-created Gail arm Konkan LNG to complete an under-construction breakwater facility, that on completion will make the terminal an all-weather facility.

Currently due to lack of the breakwater the Dabhol terminal, created in FY07 by the original Dabhol power plant promoter Enron Corporation which went bankrupt and abandoned the 1,200-mw power plant, can operate only eight months.

Konkan LNG will be getting 22-24 shipments per annum till the breakwater is built. Once that is done we will be handling 80-90 ships a year.

Gail signed two, 20-year LNG supply agreements potentially worth USD 32 billion for LNG exports from the Dominion Cove Point project in Maryland and the Sabine Pass project in Louisiana in 2011 and 2013 respectively.

The beginning of the oil and gas shipments from the US will boost Indo-US trade and has the potential to raise it by USD 2-3 billion annually, considering massive spike in energy demand, making the country third largest in the world.

“Once this pipeline delivery begins, this will connect the state-run gas major’s Kochi-Kuttanad- Mangalore-Bengaluru pipeline.”