Indian energy giant Petronet LNG is forming a joint venture with partners from Japan and Sri Lanka to build a shore-based LNG-import terminal near Colombo.
Petronet’s announcement ends months of speculation. It comes after Indian prime minister Narendra Modi signed a memorandum of understanding with Sri Lanka when he visited Colombo in May.
The company has yet to name its joint venture partners, but says it has received a letter of intent from the government of Sri Lanka to build the plant. It has not disclosed whether it will build a land-based terminal or import LNG using a floating storage and regasification unit.
“The capacity of the LNG terminal will be decided upon the gas demand in Sri Lanka and is expected to be developed in two years, after completion of initial formalities,” Petronet said.
Previous reports linked Petronet to a proposed 2 million tonnes a year (mta) terminal at Kerawalapitiya on Sri Lanka’s west coast, between Colombo and Negombo. Valued at some US$250M, the proposed terminal will help a 300 MW oil-burning power plant to switch to gas.
Petronet aims to control 30 mta of LNG imports and regasification capacity by 2020. It has a 15 mta import terminal at Dahej, Gujarat and a 5 mta terminal at Kochi, Kerala.
Future growth will span the Indian subcontinent. Petronet wants to build a US$926M, 5 mta land-based LNG-import in the Kutubdia Islands in Bangladesh. It has also been linked to LNG-import talks in Mauritius.
- LNG World Shipping