Oil & Natural Gas Corporation (ONGC) and its partners, Mitsui of Japan and BPCL, have signed an agreement to conduct a feasibility study for setting up a $500-750 million liquefied natural gas (LNG) import terminal at Mangalore.

ONGC, Bharat Petroleum Corporation Ltd (BPCL) and Mitsui signed the memorandum of understanding (MoU) with New Mangalore Port Trust on Monday.

ONGC issued a statement informing of the MoU on Tuesday.

The terminal will have an initial capacity of 2-3 million tonnes, which can be expanded to 5 million tonnes later.

The MoU was executed in the presence of Karnataka Chief Minister Jagadish Shettar and Union Petroleum Minister M. Veerappa Moily.

The first phase of the terminal will cost $500-750 million (Rs.2,800-4,200 crore), and is expected to be completed in 3-4 years.