Reuters: HPCL to buy 26% in Shell's LNG terminal: “Hindustan Petroleum Corp. Ltd, plans to buy about a one quarter stake in Royal Dutch/Shell's 2.5 million tonnes LNG import terminal in Gujarat”: Thursday, 22 September, 2005
Mumbai: Hindustan Petroleum Corp. Ltd, plans to buy about a one quarter stake in Royal Dutch/Shell's 2.5 million tonnes LNG import terminal in Gujarat, along with rights to market the gas.
"We have an in-principle agreement with Shell to buy equity in the terminal and talks are on to buy about 26 per cent," Chairman M B Lal told a news conference late on Wednesday.
Earlier on Wednesday Lal had told Hindustan Petroleum's shareholders the company had completed a due diligence study for acquisition of a stake in the Liquefied Natural Gas (LNG) terminal.
Shell's LNG plant in Hazira is the country's second re-gasification terminal, and has been designed to import 5 million tonnes of super-cooled gas a year. French oil company Total SA also holds a 26 per cent stake in the project.
The Hazira project is the country's first merchant terminal. It offers flexible short-term contracts to customers, unlike the traditional model of rigid long-term supply contracts wherein a customer is committed to buy gas for 20 years.
Lal said Hindustan Petroleum's sole interest in picking up a stake was to foray into LNG imports and then market the gas in various parts of the country.
India is promoting LNG imports and is also in talks to build pipelines to bring natural gas from Iran, Turkmenistan and Myanmar as gas use rises.
The share of gas in India's energy use basket is expected to rise to 20 per cent by 2025 from 7 per cent now.
India plans to import 7.5 million tonnes of LNG a year from Iran, starting in 2009 and running for 25 years.
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