Petronet commissions its expansion project in Dahej

New Delhi: Petronet LNG, India's biggest buyer of liquefied natural gas (LNG), has completed the expansion of its terminal on the west coast and is receiving more supplies from BP, an official said.

New Delhi-based Petronet started operating the Dahej LNG terminal on March 9 after doubling capacity to 10 million metric tons a year, Amitava Sengupta, director of finance and commercial, said in an interview. He had said in December that the terminal expansion would be commissioned in January at a cost of Rs16 billion (Dh11.4 million).

'We tied up a supply contract in October with the additional volumes coming from BP,' Sengupta said by telephone in New Delhi on March 20.
Petronet and rival Royal Dutch Shell Plc are adding terminal capacity in India when the South Asian nation's growth is estimated to slow to 7.1 per cent this year from nine per cent last year. Spot LNG prices have tumbled 60 per cent from a record $23 (Dh84.5) per million British thermal units last year and crude prices have declined 65 per cent from an all-time high in July.

'Petronet should now be positioned to source a long-term contract for its expanded capacity at Dahej, which is a concern for the stock now,' Sanjay Mookim and Prashant Gokhale, research analysts at Credit Suisse Group AG, said in a report on March 3.

Petronet's shares rose as much as 3.6 per cent to Rs39.35 in Mumbai trading, compared with a gain of as much as 3 per cent in the Bombay Stock Exchange's benchmark Sensitive Index.

Petronet currently gets five million tons of LNG a year from Qatar under a multi-year contract.