Tuesday, November 5, 2024

Shell Plans Second LNG Terminal in India

September 25, 2015

The Hague-based global energy giant Royal Dutch Shell (RYDAF) is planning to establish a floating liquefied natural gas (LNGLF) (LNG) facility on the east coast of India at Kakinada in Andhra Pradesh. 

 
Shell already has a 5 million tonne LNG terminal at Hazira in Gujarat set up nearly a decade back. The Hazira Terminal includes a LNG storage and re-gasification terminal within a fully functional port. 
 
The Andhra Pradesh government has recently decided to induct global oil major Shell with a 26 percent equity in the proposed special purpose vehicle (SPV) for setting up a floating, storage and re-gasification unit (FSRU) for liquefied natural gas at Kakinada.
 
The AP government-owned AP Gas Infrastructure Corporation (APGIC) and state-owned GAIL floated AP Gas Distribution Company (APGDC) have set up a 3.5 million tonnes capacity (expandable up to 10 million tonnes) FSRU in the East Coast at Kakinada Deepwater Port.
 
Although Shell did not reveal the cost of the project, a 5 MT LNG terminal is expected to cost around $1 billion.  The company believes that floating LNG terminal will the next big thing. 
 
India is the world’s fourth-largest LNG importer, following Japan, South Korea and China, and consumed almost 6% of the global market. 

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