NEW DELHI, Oct. 16 (UPI) -- India's Petronet LNG plans to set up a power project in Dahej.
The company said it would diversify into the power sector and set up a 1,100-megawatt gas-based power project, close to the site of its Dahej LNG regasification terminal.
A company official said the project would be financed by a mix of debt and equity.
“There were various options to fund the equity portion and Petronet might even consider a 25-percent rights issue," said P. Dasgupta, Petronet LNG's chairman and managing director.
He said other options, including a public issue or a preferential issue, will amount to diluting the promoters’ stake.
“If the promoters are comfortable with these options, we will look at them, or else we will go in for a rights issue," he said. "A firm proposal on the investment plan for this project will be put up before the board in April 2008.”
Dasgupta said the move by the country’s largest importer of LNG is a risk-mitigating exercise in order to protect the capacity of LNG it plans to produce at its two LNG regasification terminals at Dahej and Kochi.
The company also plans to expand the capacity of its Dahej LNG terminal from 6.5 million tons per annum to 12.5 mtpa. It is in the process of creating an LNG regasification capacity of 5 mtpa at its Kochi LNG terminal, The Financial Express newspaper said Tuesday.
“There is a limit beyond which we can hold LNG in tanks. Therefore, a logical way to utilize our capacity will be to venture into power production and maintain our existing profit lines,” Dasgupta said.
