|Banerjee: Step on the gas
Mumbai, Feb. 5: Gail today said it is willing to pump about Rs 500 crore as equity into a special purpose vehicle for restarting the Dabhol project. However, the money will flow only after outstanding issues between the Indian and foreign lenders and other parties concerned are resolved.
Gail and NTPC will pick up equal stakes in the project by chipping in Rs 500 crore each, Gail chairman and managing director Prashanto Banerjee told reporters here.
NTPC will operate the plant, while Gail will look after the LNG terminal and sourcing of LNG.
Gail will complete the technical evaluation of the LNG terminal in the next two months, he said.
Early this year, foreign lenders of the power project had agreed in principle to domestic lenders' buying out their debt. Subsequently, a 30- member team from Gail and NTPC began assessing the plant.
Banerjee said the government should accord infrastructure status to the terminal and pipeline infrastructure and reduce the customs duty on LNG to zero per cent from the present 5 per cent.
With the coming up of five LNG terminals, the country could see an availability of 15-20 million tonnes of LNG in the next five years, he said.
India has saved around Rs 743 crore on the long term LNG purchase contract with RasGas by linking the gas price at the crude oil rates of $20 per barrel during the recent upsurge in crude.
Banerjee was in the city to introduce the two-day Third Asia Gas Buyers summit to be held in the capital from February 14.
With consumption of gas, particularly LNG, expected to increase in the country over the next few years, the summit will be a forum for both buyers and sellers to interact. India is emerging as a big buyer in Asia, while Russia, Iran and Quatar are some of the major producers.
Apart from setting up of LNG terminals such as Hazira, Petronet LNG, Gail is planning an expansion of its Dahej terminal. The company has also started work on a terminal at Kochi.
This apart, another project that involves CPCL, Indian Oil and Gail is also on the anvil at Ennore. Feasibility studies have been completed and the project is expected to kick off after investment decisions are taken.