Petronet LNG Limited and Gangavaram Port Limited have signed a firm and binding term sheet for developing a land based LNG Terminal at Gangavaram Port with a capacity of five million Metric Tonnes Per Annum (MMTPA).

The Liquified Natural Gas (LNG) Terminal at Gangavaram Port will comprise of facilities for receiving, storage and regasification of LNG and will be developed with an approximate investment of Rs 4500 Crores.

This will be the third LNG terminal owned by Petronet, which is India’s largest LNG importer. The other two LNG Petronet owned plants are; an operational 10 MMTPA terminal at Dahej, Gujarat, and a five MMTPA terminal at Kochi, Kerela, which is likely to become operation in the next six months.

The terminal at Gangavaram Port will have the provision for further expansion like the flag-ship Dahej LNG Terminal.

The Gangavaram LNG Terminal will help meet the growing energy demand of the State of Andhra Pradesh and will also cater to the increasing gas requirements of eastern and central parts of India.

At its full operational capacity the terminal is likely to contribute over Rs 2,000 crores as V.A.T to the State Government of Andhra Pradesh.

Dr Balyan, MD & CEO of Petronet, said, “The construction work on the terminal is expected to start within a year and it shall be ready to commence operations by the Year 2016.”

“We are eager to have our presence on the east coast and are exploring various possible options to bring gas earlier than 2016 at Gangavaram Port.”

Dr. Balyan also added that the project would contribute immensely to the economic development of the region by providing additional and lower cost alternate fuel to the refinery, power, fertiliser, transport and other sectors, which in turn would result in substantial downstream investments in these sectors.