Hindustan Petroleum Corp Ltd (HPCL) in India has received six or seven bids from industries interested in leasing a portion of its Chhara liquefied natural gas (LNG) import terminal on the west coast. The CEO of the LNG unit, K Sreenivasa Rao, shared this information during a recent event. HPCL plans to start operating the terminal, which has a capacity of 5 million metric tons per year, in the December quarter.
Rao mentioned that they have received several bids and expect to make a decision on the winning bid within the next three months. HPCL intends to lease a capacity of 3 million metric tons per year to other companies for a period exceeding 10 years.
Although the terminal construction was completed in March, its commissioning has been delayed due to the absence of a 40-kilometer pipeline connection to an existing network that is used for consumer sales. However, Rao expressed optimism that the pipeline will be ready for use soon.
Initially, the terminal will operate at about 30% capacity in 2024, gradually reaching full capacity within four to five years. HPCL has also made provisions to potentially double the terminal’s capacity to 10 million metric tons per year in the future.
India is focusing on strengthening its gas infrastructure as Prime Minister Narendra Modi aims to increase the proportion of natural gas in the country’s energy mix from the current 6.5% to 15% by 2030. According to Rao, India’s gas demand is currently rising as prices have become more favorable, following a period of high prices that had reduced demand.