Norway’s Crown LNG has embarked on the development of a 7.2 million tonnes per annum liquefied natural gas terminal offshore Kakinada on India’s east coast that could start up in 2025.
Crown is working towards taking a final investment decision at the end of 2022 and expects that the project’s engineering, procurement, construction, installation and commissioning contractor and key subcontractors will be announced during the coming weeks.
Operational start-up is envisaged around three years after the Kakinada LNG import project is sanctioned.
Crown on Wednesday confirmed it has signed an agreement with East LNG to finance, build and lease the infrastructure for the Kakinada facility.
Crown has been contracted for operations and management of the facility through the 25-year lease period.
“We will build an LNG terminal that will be operational 365 days per year, including during the monsoon season, for 25 years following the completion of the terminal,” said Crown chief executive Gunnar Knutsen.
The LNG terminal will be developed as a gravity-based structure (GBS) that will sit on the seabed approximately 11 kilometres offshore Kakinada.
Not only will such a solution be able to withstand the harsh weather conditions the Indian monsoon season presents, but it will also contribute towards decongesting busy ports and keeping hazardous substances away from populated areas, said Crown.
The lack of viable LNG facilities on India’s east coast has caused significant energy shortages for the region, especially for high-volume energy users such as fertiliser, petrochemicals and power plants located in and around Andhra Pradesh.
Many such facilities have even been sitting idle due to lack of natural gas supplies, noted Crown.
“The Indian government is dedicated to safeguarding the energy supply to domestic industry and consumers, while also facilitating a responsible energy transition. The Kakinada LNG project is proof of this,” said Crown chairman Jorn Husemoen.
He added that that existing pipeline infrastructure near to the project site is mature and therefore easy to connect to, which supports the Kakinada project.
Crown specialises in LNG infrastructure for both regasification and liquefaction. Since its inception, it has focused on developing a technical solution that can operate in more severe weather conditions than typical floating storage and regasification units.
The company, together with its partners, is also working on various projects, including regasification terminals for other Asian locations, that experience similar cyclones and monsoons as in the Bay of Bengal.
UK and US projects
Crown has also signed a letter of intent to deliver a 5 million tpa floating storage and regasification unit to a gas-to-power project in the UK.
In addition, the company is working on developing a project for a GBS-based liquefaction terminal for export of gas from the US.
Crown said that further information about this and other projects would be shared “in due course”.