The company is building the facility on the port of Kakinada, in the state of Andhra Pradesh in a joint venture with Reliance Power Ltd. Shell already has a 3.6 million-ton LNG import facility in Hazira, India.
"By end of the quarter, we will be able to import 5 million tons at Hazira," said Yasmine Hilton, who heads Shell India, Press Trust of India reported Tuesday.
Shell plans to double Hazira's capacity to 10 million tons within four years, she said, adding that the Kakinada terminal can also be doubled in the near future.
Gas sourcing for the Kakinada project will be carried out through Shell's global trading outfit.
"Whether it is spot or term or from Australia, Qatar, Mozambique, will be decided by them," Hilton recently told The Hindu newspaper.
The U.S. Energy Information Administration says that the share of gas in India's power generation mix will expand from 11 percent in 2008 to 16 percent in 2035. Overall energy demand in the country is forecast to more than double by 2035 to 49.2 quadrillion British thermal units from 21.1 quadrillion Btu in 2008.
The energy-deficient country represents a huge potential for gas imports and Shell India is seeing "material" interest in upstream oil and gas exploration and production as it continues to evaluate opportunities, Hilton said.
As for downstream fuel retailing, the company has called for a level playing field so it can expand its network of about 70 gas stations.
"We must have a level playing field, market pricing and no subsidies," she said in the PTI report. "Subsidies are non-competitive. As a multinational company, I don't get any subsidies so it is non-level playing field.
"Let's have a robust investor friendly framework."
Hilton has said that Shell is the only international company that has the license to have 2,000 gas stations in India.
"We have not grown as fast as we would have liked to," she told The Hindu.
India relies on imports for about 80 percent of its crude needs.
When asked how India stands on Shell's global business map, Hilton said, "Shell is investing $30 billion in new investments -- 80 percent in upstream and 20 percent in downstream. We (Shell India) have to compete for those dollars with other Shell outfits. My job is to position India to the group and get some of the funding into India."