Petronet LNG Ltd, India's largest liquefied natural gas importer, will set up a floating LNG receipt facility at Gopalpur port in Odisha at ₹2,306 crore.

The company has signed an agreement with Gopalpur Ports Ltd for the facility that will have a capacity of about 4 million tonnes per annum, it said in a tweet.

"We are pleased to inform that @PetronetLNGLtd is heading forward in establishing its presence on the east coast of India by signing a term sheet with Gopalpur Ports Limited on 14th December 2022 for establishing and operating LNG terminal at Gopalpur port in Odisha," it said.

Last month, the company's board had accorded investment approval for setting up the floating storage and regasification unit (FSRU)-based LNG terminal at Gopalpur.

LNG is a natural gas that has been supercooled, changing it from a gas into a liquid that is 1/600th of its original volume. This helps in easy transportation through ships. At the receipt facility, it is turned back into gas before being supplied to factories to produce fertiliser, generate electricity at power plants, or turned into CNG for running automobiles.

Petronet's project in the Ganjam district in Odisha, which is expected to be operational before the end of 2025, will be financed by a combination of debt and equity.

East coast terminals

Gopalpur will be the third LNG terminal on the east coast -- Indian Oil Corporation (IOC) operates a 5 million tonnes a year facility at Ennore in Tamil Nadu while Adani Group in partnership with TotalEnergie of France is building a facility at Dhamra port.

Petronet management had previously stated that the FSRU-based receiving and regasification scheme has the provision to be converted in the future to a land-based terminal - with an expected capacity of 5 million tonnes per annum.

The firm is planning to charter hire an FSRU for the Gopalpur terminal with a target to meet the increasing gas demand of the eastern and central parts of the country.

It, currently, operates the 17.5 million tonnes per annum terminal at Dahej in Gujarat and a 5 million tonnes facility at Kochi in Kerala. The Dahej terminal is undergoing expansion to a capacity of 22.5 million tonnes.

Both are land-based terminals.

Petronet is adding 5 million tonnes of extra capacity at Dahej - already the world's largest LNG import facility - by constructing a new jetty that will also able to handle propane and ethane shipments, plus more LNG storage tanks and bays for loading trucks.

State-owned IOC, Oil and Natural Gas Corporation (ONGC), GAIL (India) Ltd and Bharat Petroleum Corporation Ltd (BPCL) each hold a 12.5 per cent stake in Petronet.

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