Mumbai, Oct 17 (IANS): India's first merchant terminal for eight million tonnes LNG import, storage and regasification will be set up at Jaigadh Port in Ratnagiri district.

An agreement has been signed between H-Energy Gateway Pvt Ltd (HEGPL), a Hiranandani Group company, and Sener-Afcons JV for the engineering, procurement and construction of the terminal which will function exclusively on a tolling model, said HEGPL director Darshan Hiranandani.

"We are pleased with the technical capability and commercial competitiveness of Sener Afcons and the value that this terminal will bring to the market. HEGPL will now engage with its various customers... The project will offer the lowest regasification tariff with the maximum flexibility to its long-term customers," Hiranandani said.

With a clearance from the Ministry of Environment and Forests in December 2013, HEGPL expects to commission the project in 2018.

The Jaigadh Port terminal shall be operated on a tolling basis, offering import and storage facilities to third parties.

The first tolling terminal in the country, it would offer 100 percent regasification capacity to gas importers and end users like power plants, fertilizer units, oil refineries and steel plants. The gas users will arrange for LNG from overseas and use the terminal to unload and transfer it to trunk pipelines.

India's west coast already has four LNG import terminals at Dahej, Hazira (Gujarat), Dabhol (Maharashtra) and Kochi (Kerala).

The HEGPL's Jaigarh Port terminal will import gas in its liquid form in ships, unload it and reconvert it into its gaseious state before sending to consumers through pipelines.

For this, it will have two LNG storage tanks of 190,000 cubic metres capacity each and shall be the first tolling terminal in India offering full regasification facility.