Mumbai: State-owned GAIL India Ltd has put in a bid of INR24bn ($375m) to buy the 5m tonnes per annum (tpa) capacity liquefied natural gas (LNG) terminal associated with the 1,967 megawatt Dabhol Power Station, operated by Ratnagiri Gas and Power Pvt Ltd (RGPPL).
However, the National Thermal Power Corporation (NTPC) has not agreed to this valuation as the total loan and equity on the terminal part is nearly double that, at INR45bn. NTPC and GAIL own 28.91% equity each in the cash-strapped utility, while the Maharashtra state government has a 15.33% stake, and the rest is owned by banks and financial institutions.
GAIL’s interest in the regasification terminal, originally built by failed US power major Enron, comes against the backdrop of the Indian government announcing a bailout plan for gas-based power projects and their lenders. Under this plan, LNG will be imported, and cash-strapped state power distribution firms given financial support to buy electricity from gas-based power producers.
It is learnt that, under this plan, India plans to import 10m metric standard cubic metres per day (mscmd) of LNG, going up to 18m mscmd after the monsoon. India has four regasification terminals, including the one at Dabhol, with a total capacity of 25m tpa.
Already, with a gas consumption of 51bn cu m (bcm) per annum, India is the world’s 15th largest consumer and the fourth largest importer of LNG, sourcing 18 bcm.