Hyderabad: The Andhra Pradesh Government and GDF Suez LNG UK Ltd will sign a project framework for setting up of a floating storage re-gasification unit at Kakinada seaport.
The terminal will be set up by GAIL and APGDC with an outlay of Rs 4,000 crore. This facility is expected to have capability to re-gasify liquefied natural gas of 15 mmscmd.
This floating unit will be a boon to gas-based independent power generation companies and thereby help boost the economic activity in the East Coast. The terminal planned to be completed by the end of 2013 will help generate additional 3,000 MW.
A project framework agreement for setting up of a floating storage re-gasification unit at Kakinada will be signed at New Delhi on Tuesday between the State-owned AP Gas Development Corporation and GDF Suez, according to a statement from the State Energy Department.
The Andhra Pradesh Government is keen that this project gets commissioned at the earliest to enable the State to help bridge the demand-supply mismatch of gas required for power plants in the State.
The natural gas produced domestically is inadequate to cater to the needs of electricity consumers including to the non-priority sectors. While 9.5 mmscmd has been allocated from KG-D6, barely 5 mmscmd is being supplied, hampering generation.
While additional capacity of 4,000 MW is under various stages of construction, there is no indication of fresh gas supplies. This project is expected to support 3,000 MW of power capacity.
The average cost of generation would work out to Rs 6 a unit versus Rs 9 a unit in the case of RLNG now.
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