LNG Alliance to develop Karnataka’s 1st LNG import terminal

Singapore-based project developer LNG Alliance has proposed to develop a major LNG import terminal in Karnataka which would also be India’s first dedicated LNG bunkering facility.

LNG Alliance plans this terminal together with the government of Karnataka and New Mangalore Port Trust (NMPT).

The LNG import terminal will have an initial capacity of 4 million tonnes per annum (MTPA). It will also have the potential for expansion up to 8 MTPA over the next twenty years.

In addition, this import and regasification terminal will also feature the ISO LNG containerisation and LNG truck loading facility. Furthermore, this will be India’s first dedicated LNG bunkering facility, providing LNG as fuel for ships at the NMPT port.

NMPT, the gateway port for the State of Karnataka, is well connected, allowing for downstream LNG distribution by virtual pipelines. This makes it the ideal location for the LNG import terminal in Karnataka.

Firstly, LNG Alliance and the State of Karnataka signed an MoU in June 2021. It then formed the foundation of the current cooperation agreement between LNG Alliance and NMPT from December 2021.

Muthu Chezhian, CEO of LNG Alliance, says this is a major step in meeting India’s cleaner energy goals. These specifically include phasing down coal-fired powerplants and transitioning to an emission-free economy using LNG as a bridging fuel.

“As part of this agreement, LNG Alliance will develop a tolling fee based floating LNG import terminal, within the maritime concession area of the NMPT. This terminal will also be open for third party access and will provide the most competitive tolling rates in India, based on the LNG sourced from our supply partners.”

To remind, LNG Alliance is building a global integrated LNG and hydrogen infrastructure portfolio. It is working with its investment and operating JV arm, Aslan Energy Capital. 

Over the next three years, it wants to invest $290 million to develop, construct, and operate a Floating Storage and Regasification Unit (FSRU), and manage the LNG supply.

By estimation, India’s energy consumption will grow by at least 35 per cent from now to 2030. As India builds out its gas infrastructure, LNG will find multiple uses in India’s energy system.