New Delhi, Feb. 26: H-Energy, a subsidiary of Hiranandani Group, has proposed a pipeline to supply natural gas from Digha to the Khulna power plant in Bangladesh.

The firm has sought the approval of the Petroleum and Natural Gas Regulatory Board to set up the 275-km pipeline from Kanai Chatta in East Midnapore district to Shrirampur in Khulnaat an estimated cost of about Rs 1,300 crore.

The regulatory board has asked those interested to submit their views or objections "to ascertain whether, instead of a dedicated pipeline, public interest would be better served if a natural gas pipeline is laid, built, operated". The views have to be submitted by March 10.

H-Energy is setting up a floating storage regasification unit on the east coast with capacity to convert 3 million tonnes per annum (mtpa) of imported LNG to natural gas in the offshore region of Digha.

The regasification unit will be connected by a 115km sub-sea pipeline to a land fall point close to Kanai Chatta near Digha and is expected to be commissioned by March 2021.

H-Energy had received the contract to build the unit in August 2015 from Calcutta Port Trust. The North West Power Generation Company (NWPGCL), a wholly owned subsidiary of Bangladesh Power Development Board, has signed an MoU to purchase regasified-LNG.

The Bangladesh company is setting up an 800-mega-watt plant in Khulna, which will use both LNG as well as diesel. It has entered into a preliminary agreement to buy 1 mtpa of natural gas for the plant for 22 years with the option to buy 2mtpa.

Bangladesh Prime Minister Sheikh Hasina is slated to visit India in the first half of April, and New Delhi is keen on increasing bilateral energy co-operation with the South Asian neighbour.

H-Energy said as eastern India has no existing natural gas pipeline network, it was a major challenge to ensure that the proposed floating unit had adequate gas evacuation infrastructure.

It has submitted an expression of interest with the pipeline regulator, proposing a natural gas pipeline of over 700km to connect the land fall point of the floating unit to major demand centres in Bengal.