Business Standard (India): Shell to invest Rs 3,000cr at Hazira Port (ShellNews.net) 17 May 05
Press Trust of India / New Delhi May 17, 2005
Royal Dutch/Shell today said it plans to invest Rs 3,000 crore in setting up a bulk cargo and container terminal at Hazira Port, where it has built an LNG receiving terminal.
"We are in discussions with Essar Steel for setting up a bulk cargo terminal at Hazira. The cargo terminal would be for Essar Steel's captive use," Marc Den Hartog, director of Shell India told reporters.
For the container terminal, Shell is talking to several multinational firms, including Maersk, P&O Ports of Australia, Port of Singapore Authority (PSA) and Dubai Port International.
"The ultimate investment (in the two terminals) will be of the order of Rs 3,000 crore," he said but did not give any timeframe for implementation of the two projects.
Shell has formed a special purpose vehicle, Hazira Port, for building the port terminals. While Essar is expected to take 50% stake in the $100 million bulk cargo terminal, Shell may offer upto 49% equity stake in the container terminal to the MNCs it is talking to in this regard.
Hartog said Shell began commercial supplies of natural gas from its LNG terminal at Hazira from Saturday, its first customer being Gujarat State Petroleum Corp (GSPC).
Shell has contracted to sell 0.7 million standard cubic metre per day of gas from its Hazira LNG import terminal to GSPC for 210 days at a price of $3.70 per million british thermal unit (mbtu).
Shell's price is slightly higher than Petronet LNG's sale price of $3.66 per mbtu.
Hartog said the first LNG consignment was sourced from Australia's North West Shelf project, in which Shell has a 22% stake.
Hazira is the first merchant terminal in Asia which does not follow the conventional model of sourcing LNG from a particular project on long-term basis and then tying up long term sales contracts with customers in importing countries.
In other words, Shell after assessing the needs of a customer and the price that it is willing to pay, will scout for LNG in global markets, and if suppliers' terms match with the customers requirment, a 'match-making' will take place.
A Shell-controlled tanker, the 136,000 cubic metres 'Gemmata', carried the first cargo.
He did not say when the company would import the second LNG consignment and from where.
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