H-Energy signs accord to site LNG terminal at East India port of Kakinada in Andhra Pradesh

Tuesday, 10 September 2019
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Indian liquefied natural gas terminal developer H-Energy and Kakinada Seaports signed an agreement for an LNG regasification and reloading terminal to be sited at Kakinada port in Andhra Pradesh, which would be only the second such facility on the East Coast of India.

Kakinada Seaports controls the concession for the Kakinada Deep Water Port under an agreement with the government of Andhra Pradesh.

“H-Energy shall develop an LNG hub at the Kakinada Port catering to the needs of domestic customers in the state of Andhra Pradesh and shall supply LNG through small LNG vessels to H-energy’s proposed Kukrahati LNG terminal in the state of West Bengal and neighboring countries like Bangladesh and Myanmar,” explained H-Energy.

Darshan Hiranandani, Chief Executive of H-Energy, said the company was excited to partner with Kakinada Seaports for this East Coast project.

“We believe that Kakinada with its existing breakwater and deep draft combined with its close proximity to various natural gas pipelines makes this an efficient and successful project for our customers, our partners, and ourselves,” said the CEO.

“The PSA along with its associated agreements envisages a long-term association between the two organizations contributing towards India’s growth story, especially, the vision of the Government to promote a gas-based clean economy," he added.

Depending on the timing, the Kakinada terminal could be only the second on the East Coast of India after the start-up in March 2019 of the first facility at Kamarajar Port in Tamil Nadu.

The Kamarajar terminal is owned by Indian Oil Corp., the refining and fuel marketing company, and has 5 MTPA of import capacity and two tanks each with storage of 180,000 cubic metres.

The Hiranandani group also has plans to deploy a floating storage and regasification import project at Jaigarh port, south of Mumbai, by the end of 2019.

The H-Energy subsidiary will operate the Jaigarh terminal with annual capacity of 4 MTPA of LNG and with re-loading capabilities.

H-Energy has explained that the FSRU charter to H-Energy is for a period of five years and the ship will arrive at the LNG jetty at Jaigarh just before the start-up.

Most of the onshore infrastructure work has almost been completed by Engineers India Ltd, a project construction company.

H-Energy said the West Coast facility would be of great benefit to Maharashtra state in western India by providing clean fuel for transportation and for city-gas use.

When operational, the regasified LNG will be supplied to customers through the pipeline connected to national gas grids at the city of Dabhol.

The facility would be the fifth LNG import terminal located near Mumbai, with three of them located at Hazira, Dahej and Dabhol for use by importers Shell, Petronet LNG and Gas Authority of India respectively.

A fourth is mechanically completed at Mundra. It is owned by Gujarat State Petroleum and the Adani Group, though has yet to be fully commissioned.

H-Energy also recently signed a cooperation accord with Russian company Novatek, operator of the Yamal LNG plant in Siberia and developer of the Arctic LNG II project.

Novatek said the memorandum of understanding envisaged cooperation in LNG supplies to India on a long-term basis, joint investment in future LNG terminals of H-Energy and in Russian LNG projects.

The Hiranandani conglomerate and Novatek said they also planned to establish a joint venture to market LNG and natural gas to end-customers in India, Bangladesh and other markets.

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