The government’s proposed liquefying facility at Delhi will have the capacity to produce 10 million tonnes of LNG per year, with the project slated to be completed by 2020.
The proposed project is the third major project in India’s LNG industry to be approved by the Indian National Gas Corporation (INGC) since the inception of the National Energy Policy.
On Wednesday, India’s National Energy Commission (NEC) issued an order approving the project.
“The project will contribute to India’s energy security and economic development,” NEC Chairman K.S. Chandrashekhar said in a statement on Wednesday.
“The proposed LNG terminal is the latest example of NEC’s proactive and visionary approach to its responsibilities as the country’s central energy regulator.”
The project is one of several planned in the country that would increase the countrys capacity to liquefy natural gas.
India is the world’s second largest producer of LPG, but has struggled to bring liquefaction technology to market.
The country has an ageing natural gas pipeline system and a large gas industry that relies on imported gas from neighboring China.
As of January, India was importing 5 million tonnes per year from China, according to a report by the Energy and Resources Institute.
According to the NEC, the project will create jobs and increase the national economy by $2.7 billion.
In the NEFSC, the decision to approve the project was made on a “diversity of factors,” including environmental impacts, the availability of gas, domestic market conditions and market stability, Chandrashetkhar added.