Govt weighs LNG terminal in Myanmar

The government is exploring the possibility of setting up a liquefied natural gas (LNG) terminal at Myanmar, according to B K Chaturvedi, union secretary for petroleum and natural gas.

In his speech at the second Asia Gas Buyers' Summit 2004 here today, Chaturvedi said, "we are exploring the possibility of building LNG terminal in Myanmar depending on the quantum of gas available from the field".

He pointed out that the first well drilled at Myanmar indicated that the initial gas could be between 4-6 trillion cubic feet (tcf) of gas. However, reserve estimates indicate that the gas could be anywhere between 14 and 42 tcf.

"Considering the major available resources, we are evaluating various option of bringing the gas through the pipelines via sea route, through land route and through coastal parts from northern states," Chaturvedi added.

The consortium of OVL-GAIL with Korean companies has reported a major discovery of over five tcf in Myanmar last month.

Later addressing mediapersons, Chaturvedi said that the government is discussing a package to bring in five million tonne of LNG from Iran and a work schedule has been formulated.

He pointed out that pricing of gas was very crucial and OVL with GAIL is working on the cost advantage of bringing the gas through sea route so that the gas can land at a price between $ 2 and $ 2.5 per btu.

Chaturvedi also said that ONGC Videsh is also discussing for carrying our exploration activities as part of the "package" in Iran.

Petronet LNG's terminal at Dahej in Gujarat is expected to add about one third of the total availability in the country while the second terminal at Hazira by Royal/Dutch Shell would add 8-10 million cubic metres of gas per day (mmscmd). Chaturvedi said both the terminals have the capacity to expand.

Chaturvedi stressed that the price would play an important role in the gas market segment as "Indian consumer is very price sensitive". he claimed that the government has brought down the cost of LNG transportation on an average to 30-32 cents from 45-50 cents. similarly the cost of regassification to 45 cents from 50-55 cents and efforts are on to reduce it further.

The overall LNG handling has thus gone down from $30 to $26 at peak and plans are to bring it down to $ 20 per million cubic metres of gas.