February 22, 2024 [Money Control]- The terminal will have the capacity of 62,000 metric tonnes capacity and is expected to enhance the storage capacity and distribution capabilities for LPG in India.
Nagpur-based LPG major Confidence Petroleum India is planning to construct an onshore LPG (Liquefied Petroleum Gas) import terminal at the Jawaharlal Nehru Port Trust (JNPT) along with its Norway-based joint venture partner BW LPG. The companies are looking to spend Rs 650 crore on the project, which is expected to be operational by 2026.
The terminal will have a capacity of 62,000 metric tonnes, the companies said during a press conference on February 19. They also expect the infrastructure to enhance the storage capacity and distribution capabilities for LPG in India.
The companies announced their joint venture (JV) on February 19 and earmarked investments worth Rs 2,000 crore for upstream and downstream expansions, to be spent in the next three years. Confidence Petroleum plans to fund the capex through internal accruals, said Nithin Khara, Chairman of Confidence Group.
Khara flagged accruals worth Rs 250 crore from the current financial year and targets earnings before interest, taxes, depreciation (EBITDA) of Rs 400 crore next year. BW Energy, which holds about 8 percent stake in Confidence group, had earlier invested $30 million to support the infrastructure plans.
The move comes amid the government’s plans to increase the share of natural gas in the country’s energy basket to 15 percent from 6 percent now. India is already witnessing growing demand accelerated by the adoption of LPG for cooking gas. The clean gas is also gaining popularity among power, industrial, and transportation industries amid greener goals.
The companies also plans port development in Porbandar, Managlore, Halida and Visakhapatnam in future.
Besides infrastructure, the JV will also examine the potential impact on trade relationships between India and other countries involved in the import and export of LPG, the companies said in a press statement.
Confidence group, which already operates 68+ bottling plants in the country, plans to scale it upto 100 plants in the next three years. These plants are where the LPG is put into bottles for storage and the bottling plants caters to public sector undertakings such as Indian Oil, Hindustan petroleum, Bharat petroleum, which the group counts as its customers.
The JV also aims to add 500 auto LPG dispensing stations nationwide. As of now, the group operates 252 such stations.
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