India plans to set up LNG terminal in Myanmar

New Delhi: India is planning to set up a liquefied natural gas (LNG) import terminal in Myanmar as it looks to expand energy diplomacy in its neighbourhood, Oil Minister Dharmendra Pradhan said on Friday.

The terminal to import super-cooled natural gas will be in addition to the similar facilities planned by Indian firms in Bangladesh and Sri Lanka as part of larger plan of energy connectivity in the South Asian neighbourhood, he said.

Speaking at a seminar on 'Assessing India's Connectivity with Its Neighbourhood', Pradhan said Numaligarh Refinery Ltd (NRL) in Assam is exploring supply of diesel to Myanmar and is looking at options to build fuel storage and distribution sector in that country.

"Indian Oil Corp (IOC) is also working with Myanmar companies in setting up LPG storage facilities and Petronet LNG is working on setting up an LNG terminal there," he said. He, however, did not give details. "India is working with Bangladesh in interconnecting gas grids and supplying diesel through pipelines," he said.

Currently, Indian firms supply diesel through rail rake from Siliguri in Assam to Parbatipur in Bangladesh and are in the process of constructing a 130-km long product pipeline for uninterrupted supply. "Also, Indian companies are working on connecting India's gas grid with that of Bangladesh and supply gas for power generation at Khulna Power Plant," he said.

"This will be an exemplary display of regional cooperation." Bangladesh is setting up an 800-megawatt (MW) power plant in the country's Khulna region, for which it has signed an agreement with the Asian Development Bank (ADB) for a USD 500 million funding. Pradhan said Petronet is also looking at building a 7.5 million tonne a year LNG import terminal in Bangladesh to feed that country's energy needs using imported gas.

"In view of providing energy access to the north-eastern part of India, there are plans to import LPG in Bangladesh and transport through road/pipeline to the region while catering to the demand of Bangladesh," he said. In Sri Lanka, India is jointly developing Trincomalee oil storage tank farm and is also working on setting up an LNG terminal and a 500 MW LNG-fired power plant near Colombo.

Also, there is a proposal to develop city gas distribution (CGD) and CNG market and infrastructure in Sri Lanka, he said. IOC Lanka, which is a subsidiary of IOC, has 43.5 per cent of the total fuel market share. "India is working with Sri Lanka on a proposal to set up a solar power plant at Sampur, which would be of 50 MW to begin with," he said.

To Nepal, India presently supplies all of its petroleum product requirements through trucks. A pipeline for supply of petroleum products is under construction, which will ensure uninterrupted supply.

"There are also discussions with Nepal on an LPG and Natural gas pipeline," he said adding Nepal has expressed interest in implementing free cooking gas (LPG) connection scheme for poor women on lines of the Pradhan Mantri Ujjwala Yojna (PMUY) to expand the coverage of LPG.

"The Hydrocarbon Vision 2030 for North East India envisages a natural gas pipeline from Numaligarh towards Sittwe (in Myanmar) in different phases. The gas pipeline will open future possibilities of gas exchange and grid connectivity," he said.

India supplies all of petroleum product needs of Bhutan, which too is planning to extend LPG coverage to 100 per cent of the population by sourcing supplies from the refineries in Assam, he said. To Mauritius, India supplies all its energy products.

"Our (neighbouring) countries are considering the construction of a bunkering facility along with a jetty," he said adding Indian firms are working with Vietnam, the UAE and Oman for presence in upstream sector to produce oil and gas.

"Regional integration through connectivity across all modes - physical, utilities-based and digital - among our countries in the immediate neighbourhood is one of the top priorities of our government. It is imperative that we, together as a group, address the weak links and overcome challenges," he said.

The BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) region is abundant in energy resources such as hydropower, hydrocarbons, and renewables.

"Since the region enjoys high insolation, it is appropriate that we consider the development of a common Solar Grid here," he said. Also, Bangladesh and Myanmar have large gas reserves which can be explored as alternate sources of gas supply.

Similarly, Nepal and Bhutan have immense potential of hydropower, which is untapped due to the absence of a market that can create demand of this magnitude. On the other hand, India and Sri Lanka are net importers of energy like many other developing countries, he said.

"The energy demand-supply sectors in Bangladesh, India, Myanmar, SriLanka, Thailand, Nepal and Bhutan offer a potential for regional resource cooperation, which could go beyond export-import trade relations and link the region in a Bay of Bengal Energy Community and thus contribute to the process of regional integration.

"The key to developing such a community lies in identifying complementary conditions and the combination of inter related production characteristics among energy supply and demand sectors of these countries," he said.

Pradhan called for reform and restructuring of the energy sector in each of these nations in such a way that the bloc becomes more competitive and efficient. The national energy systems -- gas and electricity networks -- in the South Asian countries are largely isolated from each other.

Currently only India, Bhutan and Nepal trade electricity. In addition, India supplies some amount of power to Bangladesh. Demand for electricity in South Asia and particularly in Bangladesh, Bhutan, India and Nepal is growing rapidly which call for cooperation and trade that should eventually create one of the world's largest integrated energy market, he added.