India is on course to launch a third floating storage and regasification unit (FSRU)-based LNG import project after the government of Andhra Pradesh signed a memorandum of understanding with Petrogas to ship in an initial 5 million tonnes a year through the Port of Krishnapatnam.
The port authority says the southeast coast project will start to operate within three years, using a FSRU with a minimum capacity of 5 mta and with longer-term plans to double import volumes to 10 mta within three years of project start-up.
Petrogas, a joint enterprise between Malaysia-based Isomeric and India’s LEPL Ventures, has pledged direct investment of US$449 million.
The news comes weeks after Belgium-based Exmar and India’s Swan Energy announced that they will develop and operate a FSRU-based terminal in Gujarat, northwest India. Jafrabad LNG Port is a 5 mta, FSRU-based import project that also plans to expand to 10 mta by adding a second FSRU.
US-based shipowner Excelerate will also order a 4 mta FSRU, having agreed a 25-year contract at the Port of Kolkata in West Bengal.
India is hotly tipped to become one of the fastest-growing LNG import markets. The International Energy Agency (IEA) expects Indian imports to grow 5.4 per cent a year to 2030.
The global FSRU fleet comprises just 23 vessels, owned by Excelerate, Golar LNG, Höegh LNG, BW Gas, Mitsui OSK and OLT. Five more are on order to Höegh LNG, BW, Mitsui OSK and Golar LNG.
Last year, Pakistan, Egypt and Jordan started to import LNG using FSRUs – a popular solution as the number of LNG-importing countries is expected to rise from 29 in 2014 to 48 by 2025, as they can be quicker and cheaper to build than land-based terminals.
Other Indian ports looking at FSRU-based imports include Mumbai, Pipavav, Karwar, Kakinada and Digha. The country’s four existing import terminals at Dabhol, Dahej, Hazira and Kochi, can regasify up to 25 mta.