Friday, June 17, 2005
SCI plans JV with Iran firms
New Company For transporting lNG and petrochemicals from South Pars field
Vishaka Zadoo / New Delhi June 16, 2005
The Shipping Corporation of India (SCI) plans to float a joint venture company with National Iranian Tanker Company (NITC), Islamic Republic of Iran Shipping Line (IRISIL) and Irano-Hind Company for transporting liquefied natural gas and petrochemicals from the South Pars field of Iran.
According to the guidelines of the Directorate-General, Shipping, an Indian company will need to have a 26 per cent stake in a joint venture.
Gail India Ltd, Indian Oil Corporation and NIGEC are also interested in stakes in the venture. The structure of the venture is yet to be finalised. But, tentatively, it will be a 50-50 partnership between Indian and Iranian companies, an SCI executive told Business Standard.
Gail and IOC will import 5 million tonnes per annum of LNG for $20 billion for a period of 25 years from 2009, according to the recently-concluded sale and purchase agreement with Iran.
SCI sources said 2 LNG tankers would need to be bought for the venture. LNG will be imported on a free-on-board basis, where India will make the shipping arrangement. If there is bidding, the SCI will bid as the proposed joint venture, the company executive said.
SCI had recently signed a memorandum of understanding with the NITC for transporting LNG from Iran.
This is not the first time that the SCI is looking at a joint venture or transporting LNG. India LNG Transport Company 1&2 was formed by the CI with 3 Japanese companies Mitsui OSK Lines, NYK and K Lines, and atar Shipping Company Ltd, for construction, ownership and operation of two LNG tankers.
SCIs links with IRISIL and Irano-Hind dates back to 1975. The company et up a joint venture with IRISIL, called the Irano Hind Shipping ompany, based in Teheran.
SCI holds 49 per cent equity in Irano-Hind, which was set up for part-ownership of bulk carriers only. SCI now plans to part-own LNG tankers in the proposed joint venture.
Teaming up
* Gail, IOC and NIGEC are also interested in the venture * Joint venture is likely to be a 50-50 partnership between Indian and Iranian companies * LNG will be imported on a free-on-board basis, where India will make the shipping arrangements