Shell may double Hazira LNG imports

Royal Dutch Shell, the world's biggest non-state liquefied natural gas producer, may double imports through its $600 million LNG terminal in Hazira this year, after customers agreed to pay international prices for the fuel.

Shell and partner Total SA aim to import about 24 cargoes this year, equivalent to about 56% of the terminal's capacity, Marc den Hartog, director of gas and power, Shell India, said.

Domestic power producers and manufacturers are turning to imported gas, paying as much as five times more, because declining output from aging fields has failed to keep pace with demand growth.

The turnaround at Shell's west coast terminal underscores increased confidence in the country's gas market.

Shell has never operated its 2.5 million metric tonne-a-year port and terminal project at Hazira at more than a third of its capacity since opening in April 2005.

The terminal, Shell's first ever LNG import facility, imported three cargoes, or about 1,75,000 tonne, in the first year of operations ending March 2006.

Total SA has a 26% stake in the project, according to Total's website. Shell is boosting LNG imports because fertilizer, power and petrochemical plants are switching from more expensive naphtha, an alternative to gas.