The Government is planning to bring an investment to the tune of Rs 51,000 crore on Odisha-based 5-million tonne per annum Dhamra liquefied natural gas (lNG) terminal project and the pipeline project in eastern India. Dhamra will be the sixth lNG project on the east coast and it will be completed by end of December 2019.
“We expect Dhamra an investment to the tune of Rs 51,000 crore in Odisha-based lNG terminal project and the pipeline project cumulatively into the economy of eastern India,” Petroleum Minister Dharmendra Pradhan told the reporters on Wednesday, adding that Dhamra will be the sixth lNG project on the east coast and it is expected to be completed by end of December 2019.
“About Rs 13,000 crore will be spent on the Jagdishpur-Haldia-Bokaro-Dhamra pipeline and Rs 6,000 crore on the lNG project. Another Rs 6,000 crore on city gas distribution projects in seven cities of Varanasi, Patna, Ranchi, Jamshedpur, Kolkata, Bhubaneshwar and Cuttak and Rs 26,000 crore on revival of Gorakhpur, Barauni, Sindhri and Talcher fertilizer units,” he said, while signing an Memorandum of Understanding (MoU) between IOC and GAIl to take 49 per cent stake in the Adani Group’s lNG project.
The lNG terminal and the 2,539-km Jagdishpur-Haldia- Bokaro-Dhamra pipeline, being built at a cost of Rs 12,940 crore, will usher in second green revolution in eastern India, Pradhan said. “The pipeline would bring gas to eastern Uttar Pradesh, Bihar, Jharkhand, West Bengal and Odisha and help in their economic development,” he added.
GAIl has dropped plans of a 4-mt project at Paradip, Petronet lNG, a firm in which GAIl and IOC are promoters, has shelved plans to set up a 5-mt a year lNG import facility at Gangavaram in Andhra Pradesh.
Meanwhile State-owned refiner Indian Oil Corporation (IOC) and gas utility GAIl India ltd also signed pacts to take 49 per cent stake in Adani Group’s Rs 6,000-crore Dhamra lNG project in Odisha. As far as the break-up participation of the MoU is concerned, IOC will initially take 39 per cent and GAIl 11 per cent equity in Dhamra lNG Terminal Pvt ltd and the remaining 50 per cent will be with Adani Group. “Going forward, IOC and Adani Group will each divest 1 per cent of their respective stake to a credible financial institution which will then have 2 per cent stake in the terminal,” IOC Chairman B Ashok said here in the signing ceremony.
“Apart from equity, IOC and GAIl intend to book regasification capacity of 3 and 1.5 million tons per annum respectively in the terminal,” he added.
Equity in the Adani terminal follows GAIl dropping plans in March last year to set up a floating lNG import terminal at Paradip. IOC, too, had in 2012 signed an MoU with Dhamra lNG Port Corp ltd (DPCl) to develop an lNG terminal at the port. After shelving their respective plans, the firms in May last year signed pact with Dhamra lNG Terminal Pvt, a firm owned by Adani Enterprises.
When asked why the state-owned firms dumped their own projects and choose to go with a private firm, Pradhan said their individual plans were not viable and so the two decided to join hands to set up an lNG terminal.
“Dhamra can meet all of the demand in Odisha and Andhra Pradesh. Dhamra port in Bhadrak district of Odisha is an all- weather deep water port,” the Minister said.
GAIl in October 2013 had signed an MoU with the Paradip Port Trust for setting up of the lNG import terminal. While the port was to invest Rs 650 crore in breakwater and dredging, GAIl was to invest Rs 2,458 crore for the 4-mt terminal which can be expanded to 10 mt. The plan was, however, dropped in March last year.