GAIL India and GDF Suez have signed a pact to build a floating LNG terminal.
Offering some relief to gas-starved power projects recording about 50 per cent plant load factor (PLF), the AP government was gearing up to develop a floating storage regasification unit (FSRU) on the east coast.
The state government was expected to sign an agreement with GDF Suez LNG UK Ltd this week, for setting up of the facility at an investment of Rs4,000 crore. The unit would come up at the Kakinada sea port on the east coast and would have a capacity of 15MMSCM per day. It would be operational by end-2013.
The regasification unit would convert liquefied natural gas (LNG) to the gas that could be used by the power units, with the state government, through its arm Andhra Pradesh Gas Distribution Corporation (APGDC), entering into agreement with GDF Suez.
With the regassification LNG projest, an additional power generation of 3000 MW would be available to the state, with the average cost at Rs6 per unit as against a variable cost of around Rs9 per unit.
Currently, supplies of natural gas produced domestically were not adequate to cater to the needs of electricity consumers including the non-priority sectors such as city gas distribution, ceramic and steel industries.