Indian State-owned companies Indian Oil Corporation (IOC) and GAIL have signed an MoU with Adani for taking a 49% stake in the 5 Mt/year Dhamra regasification LNG terminal project in Odisha, India's coast.
According to the MoU, Dhamra LNG Terminal Private Limited (DLTPL), the company that handles the project, will become equally owned by the Joint Venture of IndianOil and GAIL on one hand, with 39%M and 11% respectively, and Adani Group on the other. Going forward, IndianOil and Adani group will each divest 1% of their respective stake to a financial institution which will then have 2% stake in the terminal.
IndianOil and GAIL intend to book 90% of the terminal regasification capacity, respectively of 3.0 Mt/y and 1.5 Mt/y. The Rs 60,000 crore (US$900m) terminal is expected to be commissioned in 2018-2019.
The decision rises the uncertainty for other LNG projects proposed on India’s east coast to be completed as the project could meet all the demand for natural gas in the States of Odisha and Andhra Pradesh.