NEW DELHI: In a bid to counter China’s growing influence in the Island nation, India and Japan will join hands to set up a $250 million liquefied natural gas (LNG) import terminal in Sri Lanka.
“An agreement has been reached between the governments of India, Sri Lanka and Japan to set up the LNG terminal as a 50:50 joint venture by Petronet and a Japanese company,” Prabhat Singh, managing director and CEO, Petronet, said on Wednesday.
The import facility will be set up at Kerawalapitiya on western coast, Petronet officials said. Sri Lanka has plans to build a 300 MW gas-fired power plant in Kerawalapitiya. It will offer clean fuel to the power plant in that area, which currently uses oil to generate power, officials in the company said.
“The proposed LNG terminal, which will import super-cooled natural gas in ships, will take two-and-half to three years to build,” said Singh adding that the terminal in Sri Lanka is part of Petronet’s vision to own 30 million tonne (MT) per annum of LNG import and regasification capacity by 2020.
However, Japan is yet to identify the company which will form an equal joint venture with Petronet for setting up the terminal, officials said.
Last year, Petronet LNG had proposed to set up two MT LNG import facility on the Sri Lankan coast to meet its energy needs.
The LNG major already operates a 15 MT per annum import facility at Dahej in Gujarat and has another five MT terminal at Kochi in Kerala. The Dahej project is being expanded to 17.5 MT over the next two years.