The Rs. 9,000- crore LNG terminal project proposed at
Gangavaram Port by Petronet LNG Limited (PLL), a joint venture of leading
public sector oil companies, has been dropped.
This was confirmed by the Union Minister of Petroleum
and Natural Gas, Dharmendra Pradhan, to question raised by YSR Congress MP V.
Vijayasai Reddy, in the Rajya Sabha on Wednesday.
Mr. Reddy had asked about the status of the project,
to which Mr. Pradhan replied that in the absence of a firm commitment for
buying re-gasified LNG/ capacity booking from the end consumers and no firm
assurance on pipeline connectivity, the Gangavaram terminal was put on hold.
The Minister also clarified that the MoU expired on May 2, 2015. The project
proponent was supposed to establish re-gasification facility at Gangavaram by
hiring a floating bulk carrier and the terminal capacity was envisaged to be
around 5 MMTPA.
The proposal to set up an LNG terminal at Vizag by
Petronet LNG Ltd (PLL) has always been shrouded in uncertainty, even in 2016;
no progress was made despite the receipt of clearance from the Ministry of
Environment and Forests (MoEF). PLL had sought even then assistance from the
government on three areas: connectivity with three gas pipelines that pass
through the state, sort of commitment from the power sector to buy at least
1MMTPA of gas for 10 years and finally exemption of levy of VAT on import of
capital goods for the project and also on gas sales to end consumers for a
period of five years.
No response was
The LNG terminal must have facilities for receiving,
storing and regasification of LNG.