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Qatar keen to take part in India's development

NEW DELHI — Qatar is keen to participate in India's infrastructure development, especially in power and desalination projects, in which it holds considerable expertise.

Keen to step up engagement with the gas-rich country, India too has proposed various options to woo investments from Qatar in the form of equity participation, official sources said.

Petroleum Minister Murli Deora discussed many of these ideas with First Deputy Premier and Minister of Foreign Affairs Sheikh Hamad Bin Jassim Bin Jabr Al Thani and Second Deputy Premier and Minister of Industry and Energy Abdullah bin Hamad Al Attiyah during his visit to Doha to attend the International Energy Agency (IEA) meet April 22-24.

"Qatar has evinced interest in investment in energy-related infrastructure projects in India, including equity participation in projects like Petronet LNG in which it is involved," a senior petroleum ministry official told IANS.

Though Qatar's RasGas has not taken any stake in Petronet LNG due to unresolved issues about the quantum of stake, the Indian company has paved the way for offering an equity stake through plans for expansion of its equity base.

India's largest LNG importer, Petronet LNG, decided last month to raise $100 million through issue of foreign currency convertible bonds (FCCB) in June-July.

This would lead to a 7.5 per cent drop in the shareholding of state-owned energy majors including the Oil and Natural Gas Corporation, GAIL (India) Ltd, the Indian Oil Corporation and the Bharat Petroleum Corporation.

The funds raised through the bonds are earmarked for part financing Petronet LNG's second terminal at Kochi.

At the annual general meeting on June 14, the company board of directors is expected to take a decision making the bonds fully convertible into equity shares within five years of the issue, said Petronet LNG managing director and CEO P. Dasgupta.

On the possibility of RasGas being offered equity stake in the expanded equity base, Dasgupta said: "They are our strategic partners and will be given the first right of refusal."

Moreover, Qatar's participation in the state-run thermal power major NTPC's Kayamkulam power project is being mulled.

"It is proposed to raise the generation capacity of the Kayamkulam project to 2,000 MW through a new company which will open it up for foreign investment. In case the Qatar Electricity and Water Company (QEWC) decides to take equity participation in the project after it has been valued, it could help us get dedicated gas from Qatar," an official said.

India has sought additional gas supplies from Qatar, which has so far committed to supplying 7.5 million tonnes to Petronet LNG for its Dahej terminal in Gujarat and the upcoming terminal at Kochi.

In addition, Qatar has agreed to supply additional 2.2 million tonnes of LNG as a stopgap arrangement for two-and-a-half years for the operation of Maharashtra's Ratnagiri power project, formerly known as the Dabhol project. Apart from the two energy projects, Qatar has evinced interest in providing technical know-how and investment to set up industrial desalination plants, something that has been engaging the attention of planners in the southern states facing acute shortage of water.

Qatar's participation in industrial conglomerates developing special economic zones would be welcome as it would help to give a boost to industrial ventures by ensuring dedicated supply of water, making the projects more attractive, said official sources.

Talks initiated by Deora were being followed up for quick decisions on investment flows from Qatar.

Also being studied was possible collaboration in petroleum and refinery projects, the sources added.