Crown LNG discusses Indian regas scheme : Q&A
Earlier this month, Norwegian LNG infrastructure developer Crown LNG said it had started the process to develop a 7.2mn metric tons/year LNG terminal offshore India's east coast. Its Indian subsidiary has signed an agreement with East LNG to finance, build and lease the infrastructure for the offshore LNG receiving terminal at Kakinada in the state of Andhra Pradesh. Crown has also been contracted for operations and management of the facility, through the 25-year lease period.
Crown LNG said it intends to develop the LNG terminal as a gravity-based structure (GBS) that sits on the seabed approximately 11 km offshore Kakinada. In the coming weeks, it expects to announce the project's engineering, procurement, construction, installation and commissioning contractor along with key subcontractors. The company is working towards a final investment decision by the end of 2022. The terminal will be operational approximately three years afterwards.
NGW talks to a representative of Crown LNG to understand more about the project.
Tell us about the Kakinada floating LNG terminal? Why did you choose Kakinada as a site?
It is important to underline that it is Crown LNG's customer, East LNG, that owns the company, Krishna Godavari LNG Terminal Private, that holds the licence for the terminal at Kakinada. Crown LNG has been selected as a partner to finance, build, lease and operate the LNG receiving terminal because it has developed a solution that can be operational 365 days/year.
The Indian government is dedicated to safeguarding the energy supply to domestic industry and consumers, while also facilitating a responsible energy transition. However, the lack of viable LNG facilities on the east coast has caused significant energy shortages for the eastern part of India; especially for high-volume energy users such as fertiliser and petrochemicals producers and power plants that are located in and around Andhra Pradesh.
Kakinada is the only place on the east coast that is connected to India's gas network via a gas pipeline that runs across all of India. The pipeline infrastructure near the project site is mature and therefore easy to connect to. This substantially supports the project.
The 7.2mn metric tons/year capacity will be developed in how many phases?
Crown LNG's offshore LNG terminal will be built out in one phase, with an annual regasification capacity of 7.2mn mt/yr as soon as it is operational.
Note that this is an offshore terminal located approximately 11 km offshore Kakinada. The gas will be transported through a pipeline from the LNG terminal and into Kakinada.
What are the advantages of a gravity-based structure?
A solution where the substructure sits on the seabed is not exposed to weather conditions in the same way as a floating solution. It will not see any roll and pitch motions and it will be stable and at location in all weather conditions it will be exposed to that the Indian monsoon season presents, thereby enabling a 365-day operating window. It will also contribute towards decongesting busy ports and keeping hazardous substances away from populated areas.