Lok Sabha Question No. 3544 (UNSTARRED), answered on 2020-03-16
Subject: Agreement between IOCL/GAIL and Dhamra LNGTerminal Pvt. Ltd.
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Mahua Moitra

## LOK SABHA UNSTARRED QUESTION No. 3544 TO BE ANSWERED ON 16.03.2020

## Agreement between IOCL/GAIL and Dhamra LNG Terminal Pvt. Ltd.

## 3544. SHRIMATI MAHUA MOITRA:

## पेट्रोल ियम और प्राक ृ तिक गैस मंत्री

Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state: (a) whether IOCL/GAIL have signed a tolling agreement with Dhamra LNG Terminal Pvt. Ltd.  (owned  by  Adani  Group)  for  4.5  million  tonnes  per  annum  at  the  price  of  Rs. 60.18/mmbtu escalation at 5% per annum on use or pay basis for 20 years on the basis of 'protracted techno commercial negotiations' which means without tender that works out to Rs. 1400 crore of payment made to Dhamra in the first year and Rs. 46000 crore + over 20 years; (b) whether use or pay basis means that IOCL/GAIL shall pay Dhamra whether they require the capacity or not; (c) whether IOCL built an LNG terminal at Ennore for approximately Rs. 5500 crore for 5 million tonnes per annum terminal; (d) the reasons for IOCL and GAIL giving Dhamra LNG Terminal Rs. 46500 crore without a tender process for something that can be made for Rs. 5500 crore; and (e) the details of urgent action being taken by the Government as the Contract has apparently been signed?

## ANSWER

## पेट्रोल ियम और प्राक ृ तिक गैस मंत्री

( श्री धमेन्द्र प्रधान )

## MINISTER OF PETROLEUM AND NATURAL GAS (SHRI DHARMENDRA PRADHAN)

(a) to (e):  Liquefied Natural Gas (LNG) is imported under open general license on the terms and  conditions  mutually  agreed  upon  between  the  buyers  and  sellers.  LNG  terminals  are being  developed  on  market  principles  by  the  entity  based  on  its  own  techno-commercial

consideration.

Indian Oil Corporation Limited (IOCL) and GAIL both have signed Tolling Agreements with Dhamra  LNG  Terminal  Pvt.  Ltd.  as  per  their  own  procedures  for  regas  capacity  of  3.0 Million  Metric  Tonne  Per  Annum  (MMTPA)  and  1.5  MMTPA  respectively  for  20  years. IOCL has informed that the tolling charges of Dhamra Terminal is comparable with any other LNG terminal of 5 MMTPA capacity irrespective of the developer and location and same holds true for its Ennore LNG terminal.

Booking  of  regasification  capacity  in  any  LNG  terminal  is  normally  being  done  after considering  location  of  terminal,  availability  of  gas  pipeline  connectivity,  reasonability  of tolling  services/charges  and  capturable  gas  demand  in  that  catchment  area.  GAIL  has executed a Tolling Agreement inline with its procedures to meet the supply commitments of customers  located  in  the  eastern  parts  of  the  country  along  Jagdishpur-Haldia/BokaroDhamra  Pipeline  (JHBDPL)  project.  IOCL  has  also  booked  capacity  at  Dhamra  Terminal after considering its captive requirement of Paradip, Haldia and Barauni refineries which are in close proximity of Dhamra LNG Terminal.

IOCL has set up Ennore LNG Terminal at a Capital Cost of Rs. 4,500 crore near Chennai to meet the  gas  requirement  of  Tamil  Nadu  and  adjoining  districts  of  Karnataka  and  Andhra Pradesh. The supply of gas from Ennore LNG terminal to the gas demand centers of Eastern India  would  entail  extra  cost  of  infrastructure  &  transportation  and  has  its  own  technocommercial considerations.

*****