ONGC to setup LNG import terminal in Karnataka

Oil and Natural Gas Corp (ONGC) to revive plans to set up a LNG import terminal near its Mangalore refinery in Karnataka.

“In next 10 to 15 days, ONGC and Bharat Petroleum Corp Ltd (BPCL) will sign an memorandum of understanding (MoU) for putting up a LNG terminal at Mangalore,” oil minister M. Veerappa Moily announced at the inauguration of state gas utility GAIL India Ltd’s Dabhol-Bengaluru gas pipeline.

The 5 million ton capacity LNG import facility will be set up through a joint venture of ONGC and BPCL and an international energy firm of repute. ONGC has already initiated talks with Mitsui Group of Japan of setting up LNG terminal at Mangalore and the two may also strengthen their partnership by further setting up a gas based power plant in India.

The Rs4,500 crore Dabhol-Bengaluru pipeline is to be extended to Mangalore by next year and gas imported at the facility can then be pumped into the line for consumption by industries in Karnataka and neighbouring Tamil Nadu.

In 2005, ONGC had plans to build an LNG terminal, which were then shelved in 2006 due to change in leadership. But now the company has again started looking actively at the plan of LNG import, with the clear idea that domestic gas availability at 160 mmscmd in 2015-16 will be way short of demand of 290 mmscmd.

Also, Moily, who hails from Karnataka, is pushing the companies to set up the facility.

BPCL owns an equity stake in a giant gas field off Mozambique and it can ship its share gas in LNG to Mangalore.

India has three operational LNG import facilities—a 10 MMT unit at Dahej in Gujarat operated by Petronet LNG Ltd; a 3.6 MMT terminal of Shell-Total at Hazira in Gujarat, and a just commissioned 5 MMT facility at Dabhol in Maharashtra.

The Dabhol LNG terminal, which has government-owned NTPC Ltd and GAIL as partners, was commissioned last month and a similar capacity import facility will come up at Kochi in Kerala this year. LNG imported at Dabhol and Kochi will feed the same market in Maharashtra, Karnataka, Tamil Nadu and Kerala.

Currently, both Petronet LNG Ltd’s terminal at Dahej, and Shell and Total’s terminal at Hazira in Gujarat are under expansion to 15 MMT and 5 million ton capacity respectively. Even Dabhol is proposed to be expanded to 10 MMT.

Gujarat State Petroleum Corporation invites bids for LNG terminal

Gujarat State Petroleum Corporation (GSPC) on Feb 19, 2013 invited global bids to select a Engineering Procurement and Construction (EPC) contractor for its 5 MMTPA LNG regasification terminal proposed at Mundra in Gujarat.

The proposed terminal to be set up by GSPC LNG Limited (GLL), a joint venture of GSPC and Adani group, will be set up with an estimated investment of Rs  4,000 crore. "The terminal capacity would be expandable upto 10 MMTPA," official sources said. "GSPC has 50% stake holding in the JV, while Adani group holds 25%, remaining 25% will come from a strategic investor," a GSPC official said.

GSPC has been scouting for a strategic investor for its LNG project, after Essar group — the third partner with a 25% stake in the venture exited from the proposed LNG (liquefied natural gas) terminal.

The LNG terminal is designed to have two LNG storage tanks. It will have LNG receiving, re-gasification and gas evacuation facilities. The LNG terminal proposed to come up at Mundra will be the third one in Gujarat, after Petronet LNG's (10 MMTPA capacity) in Dahej and Shell's Hazira LNG terminal (3.6 MMTPA). The terminal is expected to go on stream by first quarter of 2016, sources in GSPC said.

Reliance, BP to Invest US$5 Bn in India Gas Block

Reliance Industries said the company and its partner BP Plc plan to jointly invest more than US$5 Bn over the next three to five years to boost output at a key natural gas field off India's east coast.

The D6 block in Krishna Godavari basin is jointly operated by the two energy companies and was expected to contribute up to a quarter of the gas supply for Asia's third-largest economy, but output from the block has been declining.

The two companies are planning to invest in a series of projects to develop around 4 TCF of discovered natural gas resources from the block, Reliance said in a statement.

The current output from the field is about 19 million standard cubic meters a day, less than a fourth of the initial target.

A government panel last month recommended that New Delhi scrap the system of setting natural gas prices based on the fields from where it is produced in favor of a uniform pricing model. The government hasn't yet approved the recommendation which will lead to higher prices.

Reliance currently sells gas from the block at $4.2 per million British thermal unit. The price will come up for revision in April 2014.

CH-IV International to Serve as Owner’s Engineer to Gaz Métro to Provide FEED for LNG Facility

In Order to Meet Growing Vehicular LNG Demand, Gaz Métro is looking to Expand the Natural Gas Liquefaction Capacity of its Montreal LNG Plant.

HANOVER, MD February 7, 2013 – Jeffrey P. Beale, President of CH-IV International (CH-IV), is pleased to announce that CH-IV International has been selected as Owner’s Engineer to prepare the Front End Engineering Design (FEED) for the expansion of Gaz Métro’s liquefied natural gas (LNG) production facility in Montreal, Quebec.  Gaz Métro, the largest natural gas distribution company in Quebec, is currently looking into several solutions for improving the availability of LNG in Quebec and eastern Canada, including the expansion of its Montreal liquefaction, storage and regasification (LSR) plant.

Gaz Métro’s LNG development plan is to supply LNG by truck to the heavy transport industry in eastern Canada, via its indirect subsidiary Gaz Métro Transport Solutions, LP (GMTS), and subsequently to assess the possibility of hauling LNG by truck to service more remote areas from Gaz Métro's natural gas pipeline network.  The potential heavy transport industry includes heavy-duty LNG-powered trucks, LNG-powered ferries and a development program for LNG-powered locomotives.

The LSR plant, which supplies Gaz Métro customers during peak gas demand periods, is located in the east end of Montreal and has been operating for more than 40 years.  As the present storage capacity of the two existing LNG tanks easily meets current customer demand, Gaz Métro has retained CH-IV to provide the FEED for a project focusing solely on increasing liquefaction capacity.  The FEED and EPC bid package should be finalized by the end of March.  The current expectations of Gaz Métro are then move to issuance of a request for proposals (RFP) in April for the engineering, procurement and construction (EPC) of the additional liquefaction unit.

CH-IV International had previously prepared a feasibility study to Gaz Métro on various alternatives under consideration.  The expansion of LSR’s liquefaction capacity is most likely the first step in meeting an ever increasing demand for vehicular LNG.

Mr. Beale stated, “CH-IV is excited to participate in expanding eastern Canada’s access to clean-burning, economic LNG for both vehicular use as well as fuel oil replacement.  As an early promoter of vehicular LNG, I am particularly proud that CH-IV is able to support Gaz Métro’s trailblazing effort.”

Mr. James A. (“Jim”) Kelly, of CH-IV’s Hanover, MD Office, is managing this project.

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CH-IV [read C - H - 4] International (www.ch-iv.com) is a joint venture corporation between MPR Associates, Inc. (www.mpr.com) and CH-IV Cryogenics, LP.  CH-IV International provides engineering and consulting services in four overlapping areas involving LNG facilities: 1) Feasibility / Pre-FEED; 2) Front end engineering design (FEED); 3) Engineering oversight and consulting on all things LNG; and 4) Operational services relating to the training, commissioning, start-up and operations of LNG facilities.