Hindustan Petroleum Corporation and Petronet LNG will partner with Oil and Natural Gas Corporation in the liquefied natural gas import terminal ONGC plans to put up at Mangalore in Karnataka.

The Mangalore LNG project will come up only if there is unmet demand after Petronet LNG's Kochi and bankrupt energy major Enron Corporation's Dabhol terminals are put into operation, petroleum secretary Sushil C Tripathi said.

"A detailed feasibility will be done to find out if Mangalore will be viable (after Kochi and Dabhol). If found viable, the project would be jointly executed by HPCL, PLL and Mangalore Refineries and Petrochemicals Ltd (a subsidiary of ONGC)," he said.

The board of Petronet LNG, in which ONGC is an equal promoter, will meet this week to approve construction on the Rs 1600 crore (Rs 16 billion) Kochi terminal in Kerala.

The Dabhol terminal, on the other hand, is nearly complete and the government is likely to auction it by 2005.

GAIL-British Petroleum-Tata combine, Reliance Industries, British Gas, Royal Dutch/Shell and IOC-Petronet LNG consortia are among the companies eyeing to take over the Dabhol LNG project and the adjoining 2184 MW power plant.

Tripathi said ONGC, the country's largest oil and gas exploration and production firm, should stay out of the Mangalore LNG project and its subsidiary MRPL should implement it.

"ONGC should stay focussed on its core competence of finding oil and gas which is important for attaining the country's energy security. Mangalore can be done by Petronet LNG and MRPL," he said.

Tripathi said HPCL should be involved with the Mangalore LNG project as it is a minority stakeholder in MRPL.

ONGC plans to invest Rs 25,000 crore (Rs 250 billion) in the project which will include LNG imports, its shipping and transportation, an LNG jetty and a regasification plant, a C-2/C-3 extraction plant, a 1445 MW power plant and basic petrochemical complex, including a dual feed cracker and associated facilities.

Investments will also be made in pipeline transportation of LNG from Mangalore to Ennore via Bangalore and Bidadi, to Kochi and Goa for merchant sale. Also on the cards is a 1100 MW power plant at Ennore. The Mangalore hub will be set up in a Special Economic Zone.

Petronet LNG, in which ONGC, GAIL, Indian Oil Corp and Bharat Petroleum Corp Ltd are equal promoters, has already begun operation of the country's first LNG import project at Dahej in Gujarat and would complete the Kochi terminal by 2008.

Besides Dahej, Kochi and Dabhol terminals, Royal Dutch/Shell is also putting up an LNG terminal at Hazira in Gujarat and demand for natural gas on the west coast would have to be assessed before beginning work on the Mangalore project, Tripathi said.