With Indian Oil Corporation Limited initiating measures to set up a LNG terminal at Ennore port near Chennai, the Petronet LNG terminal at Puthuvype in Kochi is bound to face fresh challenges on the gas marketing front. The 5 MMTPA plant in Kochi is undergoing tests in the pre-commissioning stage and the gas is set to flow from the terminal to end-users anytime now.

The Ennore project is being planned with an outlay of over Rs.4,000 crore and is planned for commissioning in three years. The Union government has sanctioned land for the project at the port site. IOCL intends to establish pipelines concurrently with the construction of the terminal. The company has submitted ‘expression of interest’ to Petroleum and Natural Gas Regulatory Board (PNGRB) for laying pipelines on the Ennore-Puducherry- Nagapattinam route (325 km). Spurlines are to be set up in the Chennai-Bengaluru route covering 290 km; Nagapattinam-Trichy-Madurai route stretching 242 km; and Nagapattinam-Ramanathapuram-Tuticorun route of 318 km in length.

Execution of the plan for natural gas distribution in Tamil Nadu through the pipelines to be laid by GAIL India from the Petronet’s Kochi terminal has hit a roadblock owing to opposition from farmers in Tamil Nadu. While officials have been maintaining that the dispute is being sorted out, doubts remain whether the proposed service line by IOCL would come in conflict with that of GAIL. The Gail Pipeline from Kochi is to reach Koottanad in Palakkad from where it will branch out to Bangalore and Mangalore.

The Kochi terminal is all set to supply gas to bulk industrial consumers such as BPCL’s Kochi Refinery and FACT in the city. Gas supply agreement has been signed with HLL unit in Thiruvananthapuram. A host of industrial units such as HOCL, and BSES are expected to join the list of bulk consumers shortly.

There is also a plan to utilise natural gas for KSRTC buses. A pilot LNG dispensing station is being planned and a few hundred buses are to be converted into the compressed natural gas (CNG) mode. The project is awaiting the State government’s nod.

PNGRB is getting ready to notify the city gas project for Kochi when various players in the PNG sector will vie for distribution of gas in the city. New technologies for distribution of gas through cryogenic tanks will add to the supply chain.

With only two committed end-users now, the terminal will be operating at below 10 per cent capacity in the post-commissioning stage. But the viability of the plant will depend on mass consumption of gas, a prospect which has yet to be established through multiple initiatives from the government and non-government agencies. The setting up of the Ennore LNG plant will mean that the Kochi terminal will have to get customers within Kerala so as to make it run to its full capacity.


FACT all set for spot purchase of LNGAugust 24, 2013

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