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Petronet said in a stock exchange filling that the firms entered into the MoU on Tuesday for the supply of LNG to LTL’s dual-fueled power plant(s) in Kerawalapitiya, Colombo.
The duo have agreed to develop an LNG supply chain from Petronet’s LNG import terminal in Kochi to Kerawalapitiya in a “time bound manner”.
Also, Petronet said the proposed supply of LNG from the Kochi LNG terminal would be through LNG ISO tank containers involving a multi-modal transport system.
“The initial term of LNG supply would be 5 years, which is extendable subject to mutual agreement,” Petronet said.
Petronet did not provide further information.
Media reports in Sri Lanka say that the LNG supplies would fuel the Sobadhanavi power plant, being built by LTL’s unit Lakdhanavi, and other power plants.
The Sobadhanavi combined cycle plant will have a capacity of 350 MW.
Petronet’s LNG business
Petronet is currently expanding its 17.5 mtpa Dahej LNG terminal with about 5 mtpa of new capacity, while its Kochi LNG terminal in Kerala has a capacity of 5 mtpa.
However, the Kochi terminal is currently operating at about 20 percent capacity due to lack of connectivity.
Petronet expects the Kochi-Bangalore pipeline to be completed by the end of this year or by the end of March next year and this will substantially boost the utilization of the facility.
Moreover, Petronet is investing in its small-scale LNG business, and has been supplying small industrial customers which are not connected with pipeline for years via trucks.
Currently, Petronet has a total of six truck loading bays, including four bays at the Dahej terminal and two bays at the Kochi terminal which adds up to a cumulative capacity of 60 truck loadings per day, according to the company’s website.
Petronet plans to double its truck loading bay capacity to be able to load 120 tanker trucks per day.