Petronet LNG Terminal: Fuelling Cleaner, Greener Growth

“After eight years of the start of its implementation, the (Petronet LNG) terminal is ready to fuel Kerala’s multifaceted development.” These words spoken by Prime Minister Dr Manmohan Singh at the inauguration of the Rs 4,500 crore LNG terminal in Kochi are likely to be prophetic. The project gives power-deficient Kerala an enviable source of clean, green energy that can transform its industrial, household and transport sectors.

Project Details: Petronet LNG, a joint venture between the Government of India, GAIL, Oil and Natural Gas Corporation, Indian Oil Corporation Ltd and Bharat Petroleum Corporation Ltd began work at the Kochi terminal in 2005. Located at Puthuvype, near Kochi, the project includes a marine terminal that can receive LNG tankers ranging in size from 65,000 CBM to 2, 16,000 CBM with the provision to handle Qmax size LNG tankers. With a capacity to receive, store and regasify 5 MMTPA of LNG, the project is a world class facility.
Petronet LNG imports LNG from Qatar and Australia. In fact, as per a deal signed in August 2009, the company gets a supply of 14.4 lakh tons of LNG per year for the Kochi terminal from the Gorgon project in Australia. In August 2013, the first vessel from Qatar carrying 1, 23,000 cubic metres of gas was off-loaded signalling that the terminal was now ready to meet its customers’ requirements. The second shipload of 1, 38,000 cubic metres of liquefied gas reached the terminal in September. As of now, the terminal supplies gas to FACT and BPCL Kochi.

Petronet LNG Terminal at Cochin

The Benefits
Kerala is now a prominent presence in the world LNG map. The utilisation of this clean, green fuel is expected to drive development not just in the state but across the entire southern belt of the country.
Industrial Development: The domestic gas demand is expected to go up from 15 mmscmd at present to 36 mmscmd by 2020. As per estimates, the power sector will see an increasing dependence on gas with requirement pegged to go up from 86 to 202 mmscmd by 2020. Another major user will be the fertiliser sector, where demand is expected to increase from 60 to 106 mmscmd during the same period. The LNG terminal at Kochi thus provides a ready and more economical source of gas to Kerala’s power plants.
More than 30 percent of the electricity produced in the State comes from thermal power plants, of which more than 80 percent uses liquid fuel. This dependence on liquid fuels makes the cost of generation one of the highest in the country. Substituting these fossils fuels with the natural gas / LNG would be an economical and cleaner option. Thus the NTPC power plant at Kayamkulam will benefit enormously once the undersea pipeline project gets underway. FACT already purchases gas from the LNG terminal, while Kerala Minerals and Metals Limited as well as HLL can also tap this new source of clean energy.
The LNG terminal at Kochi and the Gas Pipeline Network being established by Gail are thus crucial for the development of this industrial corridor and will lead to greater income generation, employment and growth rates in the region.
Households & Quality of Life: The LNG terminal will also have a positive impact on the quality of life in Kerala. It is a well known fact that LNG is a cleaner, greener and more convenient energy option. Kerala Gail Gas, a joint venture between GAIL and the Kerala State Industrial Development Corporation will supply piped natural gas to households and compressed natural gas to vehicles. In addition, there will also be CNG stations at Kerala State Road Transport Corporation bus depots. The supply for the City Gas Distribution scheme will be from the Kochi LNG terminal.
The benefits are numerous. Households will get relief from the vagaries of LPG distribution. Other than reliability of supply, safety is also a major consideration. Since the gas is piped in, the on-site presence of gas is minimal. In addition, the combustible mixture of natural gas and air does not ignite if the ratio is less than five percent and more than 15 percent. This narrow inflammability range makes piped natural gas extremely safe and reduces the probability of explosions as compared to storing LPG cylinders at home.
The quality of life will also improve as people will breathe in cleaner, fresher air. LNG is one of the cleanest fuels as it has fewer impurities. When burnt, natural gas produces less of sulphur di oxide and carbon di oxide as compared to oil or coal. Kerala will thus turn greener with greater adoption of LNG after the commissioning of the plant.
Kerala as Transit & Trans-shipment centre: Now that the LNG terminal has become operational, Kerala could well evolve as a strategic centre for the shipping industry. The shipping world is already debating the merits of LNG as the preferred fuel for container ships. The shipping industry is one of the biggest emitters of sulphur, nitrogen oxide and carbon di oxide and the International Maritime Organization is well aware that LNG could provide the solution. The proportion of ships using LNG is few, but the number is likely to increase as tougher environment norms come into force. As LNG becomes more popular as a shipping fuel, Kerala’s LNG terminal, which is well placed on the East-West trade route, could come into greater play.
The inauguration of the Kochi LNG terminal thus brings with it the promise of a greener, cleaner and more prosperous future for the state.