Reliance Industries and BP have announced a partnership to increase gas output form KG-D6 with an investment of Rs 40,000 crore. The question is what this means to gas importer and regasifier Petronet LNG.
RK Garg, Director-Finance, Petronet LNG welcoming the new partnership between RIL and BP, says with the government targeting to increase the consumption of natural gas in the overall energy basket, there is a need for more domestic natural gas.
Currently natural gas consumption is around 6.5 percent which has to go up to 15 percent, said Garg. Production of domestic gas would help leverage more LNG import because domestic gas is cheaper than imported gas. “So good for the country and consumer,” he said.
On the business front, he says they are further looking to expand the Dahej Unit from 15 million tonnes (mt) to 17.5 mt by around 2019. The current 15 mt is fully available for usage and the Dahej plant along is meeting 70-80 percent of the country’s imported gas requirement.
Furthermore, he says the progress of Kochi to Mangalore pipeline is good under execution by Gail. So, if everything goes as per plan then by end of 2018 the pipeline would be read and the throughput at Kochi would increase.
For Mangalore to Bangalore that is Kochi to Mangalore and then to Bangalore via Tamil Nadu, the discussions are still one, says Garg.
Kochi refineries has been expanded and the volumes have now increased and FACT is of taking the volume right now. The current utilisation of Kochi is 13-14-15 percent as compared to 5 percent earlier. As of now there are two major consumers for Kochi that is FACT and BPCL and utilisation depends on their oftake.
Going forward if profits are good and there is sufficient cash on the books, then shareholders would be duly rewarded via dividends but the decision will be taken by the Board, says Garg.
Moreover, he clarified that the Saudi Arabia- Qatar standoff is not impacting their volume inflows and the entire volume is coming as planned.Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.