GAIL, AP govt join hands to set up LNG terminal

State-run Gail India's subsidiary GAIL Gas has signed a memorandum of understanding (MoU) with the government of Andhra Pradesh for setting up of a 3.5 million tonne capacity liquefied natural gas ( LNG) terminal in the east coast.

The terminal will be set up around Kakinada or Vishakapatnam and is likely to be the first such facility on the east coast of the country with an estimated investment of Rs 5,000 crore, Gail said in a statement.

Andhra Pradesh Gas Distribution Company Ltd (APGDC), a joint venture of Gail Gas and APGIC will execute the project with the support of Gail India and work will be completed by financial year 2013, the statement said.

The company is in the process of finalizing an upstream partner for project execution and LNG supplies to the proposed terminal, it said. As per the MoU, the AP government will facilitate Gail and APGDC to obtain necessary permissions, registrations, approvals and clearances for the project.