As per the terms of the MoU, DLTPL shall be an equal joint venture (JV) of IndianOil and GAIL on the one hand, and Adani Group on the other.
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As part of the MoU, Indian Oil will have 39% stake in the project while Gail would acquire 11% equity.
Dhamra LNG is due to open in 2018-2019.
“Going forward, IOC and Adani Group will each divest 1 per cent of their respective stake to a credible financial instituion which will then have 2 per cent stake in the terminal”, IOC Chairman B Ashok said at the MoU signing ceremony. Apart from equity, Indian Oil and Gail intend to book regasification capacity of 3mn mt/yr and 1.5mn mt/yr respectively in the terminal.
Presently, the states in eastern India, such as Odisha, Bihar, Jharkhand and West Bengal, are not able to get the benefits of natural gas in sectors like domestic, transport, industries, and so on as the region does not have gas infrastructure by way of LNG Terminals and cross-country gas pipeline grid. “This will also provide momentum to the economic growth of this region by attracting new industrial projects”, Indian Oil said.
Gas imported at the terminal would feed IOC’s three oil refineries at Barauni in Bihar, Haldia in West Bengal and Paradip in Odisha. It will also supply gas to major east coast cities and compressed natural gas (CNG) as alternative fuel.
Sources told the Times that the gas firm failed to reach agreement with the leading bidders, who had filed proposals with conditions outside the scope of the government’s original tender.
The two firms will also buy nearly all of the regasification facility’s output and will put it towards a variety of end uses, including gas demand from refineries, fertilizer plants and municipal gas distribution networks in eastern India.
Factories and vehicles are expected to need more natural gas in the coming years, and Indian Oil has been booking capacity in LNG terminals across the country to tap in to the expected gas demand. Approximately RS13 000 Crores of this will be used for JHBDPL pipeline infrastructure, whilst RS6000 Crores will be used for the city gas distribution projects in seven towns.
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Shares of GAIL (INDIA) LTD. was last trading in BSE at Rs.386.9 as compared to the previous close of Rs. 385.4.
