Singapore-based Atlantic Gulf & Pacific (AG&P) has broken ground on LNG import facility at Karaikal Port, Puducherry in India.

Being built on a 12ha site within the Karaikal Port, the Karaikal LNG terminal is intended to expand access to natural gas for downstream customers in South India.

Scheduled to enter service by the fourth quarter of 2021, the AG&P-operated import facility will have deep-water access on the East Coast of India south of Chennai, with all-weather capabilities and 24/7 operations.

The new terminal is strategically located 280km south of Chennai and in close proximity to Tamil Nadu’s manufacturing clusters.

With an initial capacity of one million tonnes per annum (MTPA), the Karaikal LNG facility will include a floating storage unit (FSU), which is leased through a long-term charter agreement with ADNOC Logistics and Services (ADNOC L&S).

AG&P terminals and logistics president Karthik Sathyamoorthy said: “With the addition of AG&P’s LNG import terminal, the Karaikal Port will become a gateway for the delivery of cleaner and lower-cost fuel to downstream demand centres that are unable to access natural gas today.

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“Our goal is to bring down the unit cost of regasification terminals for smaller volumes to make LNG commercially viable for scattered and smaller customers. We will achieve this at Karaikal through the unique solution we are implementing with our partners such as ADNOC L&S.”

Truck loading bays will also be constructed to enable LNG delivery to remote customers by AG&P’s fleet of trucks.

AG&P CFO and chief commercial officer Abhilesh Gupta said: “Karaikal LNG will play a crucial role in the GDP of Southeast India. Karaikal LNG is a vital infrastructure project that will provide a substantial boost to the region’s economy.

“It will help improve the socio-economic conditions of communities within a few hundred-kilometre radius through local employment and the development of industries via reliable and affordable access to natural gas and LNG.”

Illustration of new LNG import facility at Karaikal Port. (Credit: Business Wire)