Singapore-based gas and LNG logistics company AG&P broke ground on its LNG import facility at Karaikal Port, Puducherry, on Thursday, which is paving the way to broader access to natural gas as a primary fuel in South India.
The company said the Karaikal LNG import facility (Karaikal LNG) is expected to commence commercial operations by Q4 2021.
“It will become a landmark infrastructure development for the region and is ideally suited for the Karaikal Port, a critical center of trade,” said AG&P chief executive JM Sigelman.
AG&P president of terminals and logistics, Karthik Sathyamoorthy, added that the company’s goal is to bring down the unit cost of regasification terminals for smaller volumes to make LNG commercially viable for scattered and smaller customers.
Karaikal LNG is owned and operated by AG&P, which is being built on a 12-hectare site within the Karaikal Port, having the only deepwater access on the East Coast of India south of Chennai.
Karaikal LNG will also have an initial capacity of 1 mtpa and will include a floating storage unit (FSU) leased through a long-term charter agreement with ADNOC Logistics and Services from 2021.
Sigelman said AG&P is taking on the value chain from import of LNG through to delivery of gas to end-customers—vehicles, kitchens, large and small factories, power, restaurants and malls. Karaikal LNG is a cornerstone project for Pondicherry, Tamil Nadu, and Karnataka that will provide clean, affordable fuel. Located 280 km south of Chennai and near Tamil Nadu, the new terminal will provide natural gas to power plants, industrial, and commercial customers within a 300-km radius.