British Gas India, part of the British Gas Group, is looking at options for the Rs 3,000 crore (Rs 30 billion) liquefied natural gas terminal project at Pipavav in Gujarat, in case it does not get the contract to supply LNG to the National Thermal Power Corporation.

Although British Gas had planned investments over the next three years for the LNG terminal at Pipavav, much would depend on securing the NTPC tender, Nigel Shaw, chief executive officer of British Gas India, said.

"The NTPC contract is important, and the development of the LNG terminal at Pipavav will depend on it," Shaw said.

"The contract will translate into a supply of 3 million tonnes of LNG a year to NTPC. By supplying this anchor load (a chunk of imported LNG to an assured buyer), we can push the market for the fuel to 5 million tonnes a year."

NTPC had invited global tenders to supply fuel for its gas-based power stations. The tenders were for the supply of LNG and/or regassified LNG for NTPC's gas-based power units at Kawas and Gandhar in Gujarat, Anta in Rajasthan and Auraiya in Uttar Pradesh, with a combined capacity of 2,600 mw.

NTPC invited price bids from global oil and gas majors for the four projects in April. NTPC also intends to use the gas to meet any shortfall at its existing power plants in the country.

The Pipavav terminal will initially handle 2.65 million tonnes of LNG a year. It will later scale up import handling facilities to 5 million tonnes of LNG a year.

As an alternative to the NTPC contract, British Gas is also in talks with the government of Gujarat for setting up a 600-1,000 mw power plant at Pipavav.

"This gas-based power station will supply gas to the less developed parts of the state like Saurashtra," Shaw said.

Recently, the British Gas board met Gujarat government officials to discuss investments in the state. It asked for incentives because nearly 30 per cent of the cost of regassified LNG was accounted for by direct and indirect taxes.