GAIL India, GDF, Shell Sign FLNG Deal

Andhra Pradesh Gas Distribution Corporation (APGDC), GDF Suez, Shell and GAIL have signed two separate Memorandums of Understanding (MoUs) for a floating LNG terminal in Kakinada, Andhra Pradesh, India.

The first MoU is between APGDC, GDF Suez and Shell and supports the development of the terminal. APGDC (a JV company between the Government of AP and GAIL), GDF SUEZ and Shell will have 48%, 26% and 26% equity in the project respectively, GAIL India said Friday.

The second MoU is between GAIL, GDF Suez and Shell and covers both the sourcing of LNG and the marketing of the regasified LNG from the terminal. GAIL, GDF Suez and Shell will have 48%, 26% and 26% equity in the project respectively.

“This is first of its kind LNG Terminal in India and would prove to be an important infrastructure for import of LNG on the eastern coast. Natural gas is emerging as a significant fuel for economic development of the country and this FSRU based LNG terminal will surely play a far reaching role in making natural gas available to various consumers in industrial, commercial and domestic sectors,” B C Tripathi, Chairman & Managing Director said.

The Kakinada LNG terminal will use Floating Storage and Regasification Unit (FSRU) with a peak capacity of 5 million tonnes per annum (mtpa) with the provision to double the capacity.

Yasmine Hilton, Chairman, Shell Companies in India, said, “Shell is pleased to contribute to this opportunity with our partners as a LNG terminal in Andhra Pradesh will help meet the energy demand in the region.”  

Lucas Hautvast, CEO & President of GDF SUEZ Energy South Asia, Middle East & Africa, said, participation in the Kakinada LNG project confirms GDF SUEZ’s confidence in the Indian energy growth potential.