Essar Group has won a bid for setting up 1 million tonne liquefied natural gas (LNG) terminal at Haldia port in West Bengal.
Haldia Dock Complex under Kolkata Port Trust had earlier this year invited bids for setting up of LNG terminal with storage and distribution facilities.
Essar Ports Ltd in consortium with Ultra LNG and Essar Shipping Ltd won the bid to build and operate the LNG receipt and storage facility for 30 years, sources privy to the development said.
Petronet LNG Ltd and V Energy were other bidders for the project that would have a minimum guaranteed traffic of 0.2 MTPA. The LNG project is expected to be commissioned in two years.
Haldia being a low-draft river port, the 1 MT terminal will serve as a daughter facility to sea port-based LNG terminals. In the absence of a pipeline, LNG will be distributed in tankers to the industries in the hinterland, replacing use of costlier liquid fuel.
When contacted, an Essar spokesperson said: “As a Group, we keep looking at growth opportunities in businesses. But it is not our policy to comment on any specific proposal.”
Sources said investment in the project will be in excess of Rs 450 crore over a period of two years.
Essar plans to develop an innovative solution for LNG terminal and distribution facilities in Haldia which will be one of a kind and tap the requirements of primary and secondary hinterland with evacuation route by road, rail and pipeline as and when available.
The terminal will be designed for handling of LNG carriers as per prevalent draft at Haldia port.
Essar Ports had previously announced plans to set up a floating storage and re-gasification unit (FSRU) at Hazira in Gujarat at a cost of Rs 3,500-4,000 crore.
It currently has a capacity of 140 MTPA of ports and terminals in the country. The capacity is being expanded to over 190 million tons over the next few years.
Its five operational port terminals are located at Hazira and Vadinar in Gujarat, Paradip, Salaya and Visakhapatnam.
Essar Ports, which operates port terminals on the east and west coasts of the country, has recorded a 25 per cent growth in its cargo traffic in 2016-17.