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British Gas joins race for Dabhol LNG terminal

Sambit Saha

Gas major British Gas India has joined the race to buy the 5 million tonne per annum liquefied natural gas regassification terminal of the Dabhol Power Company, a facility of the battered Houston-based energy major Enron Corporation. The other bidders till date are Royal Dutch Shell and state-run Gas Authority of India.

Disclosing this, C R Prasad, chairman of British Gas India, said, "We are interested in the LNG terminal project of DPC and all other associated facilities. We have already communicated our position in this regard to the Industrial Development Bank of India. We have all the expertise to run such facilities."

Prasad, however, was tightlipped about how much British Gas would like to shell out for the project which is nearing completion. The British Gas chairman was also not forthcoming whether the company would appoint consultants to carry out the required due diligence. "Let the matter (Enron issue) settle down first before we elaborate on our plan," he added.

British Gas is also actively developing a project for import and regassification of LNG at Pipavav port in Gujarat. This project is initially targeting sales of 2.65 mtpa of LNG with a possible increase to approximately 5.30 mtpa.

While British Gas is yet to spell out its plan in detail, GAIL has gone ahead with its proposed LNG terminal. Petroleum ministry has given green signal to the gas marketing company in late November and it is now in the process of finalising a consultant to carry out feasibility study.

"Centre has allowed us to bid for the LNG facility of DPC on the west coast of India. The public sector behemoth would be immensely benefited if we can acquire this," Proshanto Banerjee, chairman and managing director, GAIL, said.

GAIL will shortlist the consultant during this month and it would be given two months time to carry out the due diligence exercise.

"While Centre has allowed us to go ahead on our own, we may go for strategic alliance with some other company. The outcome of the due diligence report, expected to be ready by February 2002, would detail the possibilities," S Niyogi, director, GAIL said.

The Godbole Committee has valued the LNG regassification facility of the DPC at Rs 28.50 billion. It had recommended that the facility be hived off into a separate entity and sold to the public sector GAIL or any other private sector company.

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