Petronet LNG is planning to set up a 5 million tonnes per annum liquefied natural gas terminal along the East Coast, a top company official said.

The Petronet board has approved a proposal to carry out the detailed feasibility report for the terminal, which, at current rates is expected to cost at least $1 billion, Mr A.K. Balyan, Managing Director and CEO, said.

The terminal is expected to be ready in five years. The pre-feasibility and internal assessment had thrown up five to six locations, including Gangavaram and Kakinada in Andhra Pradesh, but a final call will be taken based on the detailed report, he said.

Mr Balyan also said work on the Kochi terminal was on track and it was likely to be commissioned by the fourth quarter of 2012.

Dahej Expansion

“Looking at the huge demand for natural gas, including LNG, the board has decided to raise the Dahej terminal capacity by an additional five million tonnes per annum beyond its present nameplate capacity of 10 mtpa,” Mr Balyan added.

This is expected to be done by 2015. The expansion will be partly funded by off takers such as the GAIL and Gujarat State Petroleum Corp, and they have sought dedicated capacity at the terminal for importing their own volumes of LNG.

Gas Supplies

Mr Balyan also said there was ample supply of gas, and that Petronet was talking to Qatar and Australia for further long-term supplies. Currently, Petronet imports 7.5 mtpa of LNG from Qatar on a long-term contract.

Besides the long-term imports, Petronet also imported nine cargoes from the spot market and six service cargoes (leasing out its terminal for import by companies). During this fiscal, the company plans to import 10 cargoes from the spot market, he said. He said that Petronet was seeking 2-4 million tonnes of additional LNG on a long-term contract from Qatar.

Results

Meanwhile, Petronet reported a 130 per cent increase in net profit at Rs 256.71 crore for the June quarter over the corresponding period last year.

“This increase in net profit is on account of additional volumes, better margins on short-term contracts and spot cargoes sourced by the company,” Mr Balyan explained.

The company processed and sold 2.62 million tonnes of LNG in the quarter, up from 1.87 million tonnes in the same period last fiscal, from its Dahej terminal. The rise in volumes resulted in a 83 per cent increase in turnover for the period.

The company's shares on the Bombay Stock Exchange touched a new high on Wednesday, closing at Rs 153.15.

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