The state-owned National Thermal Power Corporation has once again extended the last date for inviting pre-qualification applications for the supply of two million tonnes of liquefied natural gas per year, or eight million cubic metres of natural gas per day, for its 2,000 MW Kayamkulam project in Kerala.

The deadline has now been extended to July 17. Originally, the last date for inviting pre-qualification applications was May 16. However, it was postponed to July 2 and now it has been shifted to July 17.

Though the officials refused to give reasons for the repeated postponement of the deadline, it is learnt that the corporation is awaiting clearance from the government for putting up a two million tonne LNG import terminal at Kochi or Kayamkulam.

They said the government felt an independent LNG import terminal at any of these locations, which are just 120 km apart, would spell disaster for the 2.5 million tonne import terminal being planned at Kochi by Petronet LNG.

Petroleum secretary B K Chaturvedi, who is also chairman of Petronet LNG, has said in case Petronet LNG did not get the NTPC contract for supply of gas to the Kayamkulam project, it would look at demand from other industries in Kerala and Karnataka. Officials, however, said this demand would not be sufficient to make the import terminal viable.

Petronet LNG has already spent Rs 30 crore (Rs 300 million) on the Kochi project and Gail (India) Ltd is conducting a survey for laying a Kerala-Karnataka pipeline for transporting regassified LNG.

The industry sources insist that apart from the Kayamkulam project, there is no industry in Kerala or Karnataka that can sustain another LNG import terminal at Kochi.

In any case, the recent spurt in gas discoveries in various parts of the country has increased the availability of cheap natural gas, thereby shrinking the market for expensive gas.

They point out that even the government-sponsored Natural Gas Master Plan, 1999, had recommended that the distance between two 2.5 million tonne LNG import terminals should be at least 300 km to make them viable. Regassified natural gas can be supplied more economically through pipelines up to a distance of 300 km.