Adani Ports and Special Economic Zone Ltd (APSEZ) will build liquefied
petroleum gas (LPG) handling facilities at Gangavaram Port in Andhra Pradesh
and the terminal’s 5 lakh capacity will be fully underwritten by State-run
Indian Oil Corporation Ltd (IOCL).
APSEZ said it has signed a memorandum of understanding (MoU) with
India’s biggest oil refiner for a takeor-pay contract for building LPG handling
facilities at its Gangavaram Port.
APSEZ, the port’s unit of the
Adani Group, revealed the plan while announcing the company’s third quarter
financial results on 7 February.
India’s biggest private port operator, though, did not disclose the
capacity of the terminal nor the investment in the LPG facility in Gangavaram
Port which it acquired in 2021 for Rs6,200 crores and merged with APSEZ last
year after securing approvals from the National Company Law Tribunals at
Ahmedabad and Hyderabad.
A take-or-pay contract means
that the oil refiner will have to pay for using the terminal’s full 5 lakh
capacity a year even if it ships less than the committed quantity.
Indian Oil Corporation currently uses State-run Visakhapatnam Port,
located adjacent to Gangavaram Port, to import LPG.
India’s LPG consumption is forecast to grow to 30.3 mt by 2025 and 40.6
mt by 2040, according to the Ministry of Petroleum and Natural Gas.
On the Western coast, LPG terminals are located at Kandla, Mundra,
Dahej, Pipavav, Mumbai, Jawaharlal Nehru Port, and New Mangalore with one more
facility coming up at Cochin Port. On the East coast, LPG cargo is handled at
Visakhapatnam, Ennore, Paradip, and Haldia ports.
Indian Oil Corporation runs
exclusive LPG handling terminals at Ennore near Chennai and Haldia ports with a
new facility to start operations soon at Cochin Port.