GAIL, Petronet, IOC may be in race

Dabhol's LNG terminal has many contenders. GAIL India Ltd, which has been looking for an LNG receiving and regasification facility for its ambitious plans to import floating cargoes from the spot market, is unlikely to leave any opportunity to acquire Dabhol LNG.

Petronet LNG, which is setting up its Kochi terminal in the next two years and increasing capacity of Dahej LNG terminal from the present 5 million tonnes per annum (mtpa) to 12.5 mtpa subsequently, has obvious synergy with Dabhol.

However, P Dasgupta, chairman and managing director of Petronet LNG, said the "high cost of the project could be a hurdle. If approached, we will do a due diligence and then only take a decision".

A news agency report quotes Petroleum Secretary MS Srinivasan as saying that the government wants Petronet LNG to buy the terminal. Indian Oil Corporation, which wants its own LNG import facility, will also be interested.

Indian Oil Corporation, which wants its own LNG import facility, will also be interested.

However, the key question that remains unanswered is long-term LNG supply. For its viability, Dabhol LNG needs a long-term supply arrangement with one of the suppliers either from the Middle-East or from Australia.

Dabhol LNG has been scouting for long-term LNG supply but there is hardly any LNG available in the open market for long-term contracts.