Petronet LNG Ltd

MR. S. RAMESH – NIRMAL BANG EQUITIES PRIVATE Annex-1

Ladies and gentlemen, good day, and welcome to Petronet LNG Limited Q4 FY '25 Earnings Conference Call, hosted by Nirmal Bang Equities Pvt Ltd. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded.

I now hand the conference over to S. Ramesh from Nirmal Bang Equities Pvt Ltd. Thank you, and over to you, sir.

Good morning, ladies and gentlemen. On behalf of Nirmal Bang Institutional Equities, I've pleasure inviting you all for this fourth quarter FY '25 earnings conference call with the management of Petronet LNG Limited.

The management is represented by Mr. Saurav Mitra, Director Finance and CFO; Mr. Rakesh Chawla, Group General Manager and President, Finance and Accounts; Mr. Vivek Mittal, Chief General Manager and Vice President, Marketing; Mr. Debabrata Satpathy, General Manager, Finance and Accounts; Mr. Vikash Maheswari, Deputy General Manager Finance and Accounts.

Let me also welcome Mr. Saurav Mitra for his first earnings call after taking over as Director Finance. Over to you, Mr. Mitra, for your opening remarks, and then we can throw the floor open for Q&A.

Yes. Good morning to you all, and thank you for the warm welcome. Well, financial year 2024- '25 has been an excellent year for us, both in terms of operational and financial performance.

Delving on the highlights, PLL achieved the highest ever overall volume throughput of 934 TBTU. And for the first time ever, the profit before tax crossed INR5,000 crores. The company recorded highest ever profit before tax and profit after tax of INR5,275 crores and INR3,926 crores, respectively, registering a growth of 11% over the previous financial year.

Let me now turn to the fourth quarter of FY 2024-'25. We posted our highest ever Q4 profits.

PBT stood at INR1,446 crores compared to INR996 crores in Q4 of the previous financial year and INR1,169 crores in the previous quarter of the current financial year. Profit after tax stood at INR1,070 crores compared to INR738 crores in Q4 of the previous financial year and INR867 crores in the previous quarter of the current financial year.

In terms of LNG volumes, Dahej Terminal processed 189 TBTU compared to 219 TBTU in quarter 4 of the previous financial year and 213 TBTU in the previous quarter of the current financial year. Overall, Q4 volume processed was 205 TBTU compared to 234 TBTU in Q4 of the previous financial year and 228 TBTU in the previous quarter of the current financial year.

On a full year basis, Dahej processed 876 TBTU, up from 865 TBTU during previous financial year. Total LNG processed by the company reached record heights of 934 TBTU, up from 919

TBTU during the previous financial year. We have received INR360.94 crores of Use or Pay dues pertaining to Calendar Year 2021, thanks to the Board approved mechanism in place

The strong financial performance are a result of operational efficiency, cost discipline and higher capacity utilization. Further, the Board of Directors has recommended a final dividend of INR3 per share. To sum up, this year was about delivering consistent growth, staying financially prudent and raising the bar on performance. We are confident about continuing this momentum in the coming year also. Thank you.

So now we can have the Q&As.

Thank you very much. The first question is from the line of Probal Sen from ICICI Securities. Please go ahead.

Sir, a couple of questions. First is, with respect to the capacity expansions that we have already completed, plus whatever is in prospect, any color you can throw on the status of additional contracts in terms of offtake contracts that we have signed or in the process of signing to secure these long-term supplies being placed in the market? That was my first question.

Okay. So Mr. Vivek Mittal will answer this.

So Dahej, as you know, we are expanding from 17.5 to 22.5 million tons and hopefully, within next 3- 4 months, we expect this to be ready for commissioning. And we are in discussion with various parties. And in addition to this, some of our existing capacity holders also bring in additional volumes under the long-term contracts they have.

So utilization and further, as all of us are aware that almost 200 million tons of new liquefaction capacity is getting added in the next 3, 4 years' time frame, so LNG availability will also increase.

So India is well positioned to take advantage of that. So with that, we don't see any issue with utilization of the terminal capacity, specifically the Dahej Terminal, which is very well connected with the national gas grid.

Just a follow-up on that, sir, with respect to the renewal of the existing long-term contracts with Qatar, where are we with that exactly? And forgive me if you've already updated on this earlier.

But where exactly are we in terms of these things?

On 6th of February 2024, we signed a contract with Qatar, wherein the 7.5 million ton has now been renewed for another 20 years from 2028 to 2048. And we have an assurance that the entire volume will be taken by GAIL, Indian Oil and BPCL, and we expect shortly to sign downstream agreements related to this volume.

Right. Second question, sir, with respect to the petrochemical project. Any update you can share in terms of the investment done and where are we with respect to the time lines as of now with the petrochemical project?

Yes. The time line remains the same, which has been announced earlier. We'll be completing during the end of last quarter of 2027-'28, and we'll be ready with the production in the first

quarter of -- last quarter of '27-'28. So -- and we have already given the -- started giving the LLIs, long-lead items orders. Work is in progress in full steam. And we have scheduled capex program of around INR5,000 crores -- INR4,500 crores to INR5,000 crores in the current financial year, wherein the Dahej petrochemical -- for Dahej petrochemical project, we have targeted around INR2,500 crores of capex.

The next question is from the line of Yogesh Patil from Dolat Capital.

Sir, considering the PNGRB regulations for the registration of LNG terminal, so sir, Petronet LNG will set up the 2 LNG tanks at Dahej. This might need a separate registration permissions from the side of PNGRB Board. And one more related, these regulations also suggest that avoiding of infructuous investments, this might suggest the capping of the new LNG terminal in addition. So we are also planning to set up the Gopalpur LNG terminal. So do we expect any kind of delay on that side because of this registration regulation?

Okay. So far as this regulation, this notification, which has come up on 8th of May this year, we don't foresee on the first reading any major challenge. And however, our team is looking into the matter in detail, and we'll be able to come up with further detailed analysis only once the notification is reviewed in greater details. So as of now, I can only say that we don't -- on the first reading, we don't foresee any major challenge.

Yes. Sir, second question, India's LNG import has increased 8% on a Y-o-Y basis while the Dahej Terminal volume has declined 14% compared to the last year. Sir, this indicate that we are losing a market share despite the cheapest regas tariffs. Sir, any particular reason why we are losing a market share? And what kind of a strategy you have to arrest it?

So basically, firstly, if you look at the annualized numbers, so Dahej terminal utilization on annualized basis has increased. So it is not that it has declined because I think it was increased by…….1% So sir, I'm talking about the Q4 FY '25 numbers only.

And Q4, if you talk, the spot prices were definitely on the higher side. And if you see that there was a decline in crude oil prices, which means the liquid fuel prices were on the cheaper side.

So that's the reason there was some -- and secondly, there was some fertilizer plant major shutdown during February and March of the last quarter. So these 2 factors attribute why the utilization of Dahej has slightly gone down in the Q4.

And last question, sir, Dabhol breakwater facility is completed and terminal is expected to be all-weather terminal now. Considering that average monthly regas volumes, which were shifted historically in the monsoon period to the Dahej. And Dahej is expected to be impacted because of some quantity during the monsoon months. So how you will cover this shortfall in volume FY '26? And any strategy on that side?

Indian gas demand is expected to grow at 6% to 7% annually. So I don't think -- I think there is space for everyone to survive in this market. And Dahej, as you know, is very well connected with the multiple pipeline networks of GAIL, GSPL, some private network. So we don't see on

a long run any issue with, we don't foresee. And in fact, with the more availability of LNG, as I mentioned previously also, we do expect the utilization level to go up and in fact, Dahej is further expanding keeping in view the expected demand, which is going to come after the implementation of CGD down.

The next question is from the line of Varatharajan Sivasankaran from Antique Limited.

Sir, as far as this bank guarantees are concerned and what we have encashed, so far for calendar '21 and '22, what has been the amount we have encashed and what has been the compensatory volume, which has come through? So is it largely bank guarantee encashment? Or like we have had volumes also come through?

As far as calendar '23 and '24 is concerned, Are bank guarantees in place or the process is just about initiated, what is that...

Okay. So we are happy to announce that none of the bank guarantees have been encashed. All the money that have come in, it has been paid by the offtakers. This is number one. And so far as bank guarantees for the subsequent years are concerned, we are in the process of getting the bank guarantees for calendar year 2023.

And on the second question about what you had assured about the 7.5 million tons offtake being, once again, that we initiated with current off-takers, you said like it's about to be signed. Any more incremental details you can share with us? Would they also be committing to additional volumes? Or is it as of now, restricted to the 7.5 million.

See, we are talking of 7.5 million ton SPA, which was signed with Qatar on 6th of February 2024. So there is an offtake commitment, which has been guaranteed by all the 3 existing operators: GAIL, Indian Oil and Bharat Petroleum. So we are talking about that. And we are in discussions with them to finalize the downstream agreements, basically the definitive agreements like gas sale purchase agreement for these volumes.

So there is no discussion currently on for the expanded capacity as well?

See, expanded capacity, we are in discussion, wherein they bring in their own volumes. In fact, if you're tracking the market, all the players, GAIL, Indian Oil, Bharat Petroleum, all of them have signed long-term SPAs directly, so these volumes are bound to come to some terminals.

So we expect substantial volumes to land at Dahej Terminal. Already, they have existing regas capacity. If required, they may augment that capacity commitment.

The next question is from the line of Pratyush Kamal from InCred Capital. Am I audible? Yes.

Yes. So my question is regarding the use or pay charges, which are levied and how and when it gets reversed. So I just wanted to explain in the way that suppose I'm a customer who have taken x million ton of gas in CY '21, FY '22. And when your regas charges was Y. For example, it was

55. And not at that time you booked it as receivable amounting to, say, INR100 crores, but later put a provision of about INR100 crores against that due amount.

Now when the customers are taking those volumes back, when your regas charges has increased, suppose it has become 65 or 60 or something like that, it will lead to about INR150 crores of revenue generation. So will that UOP provisioning of about INR100 crores gets reversed first, and then the additional provisioning of INR50 crores gets added in the revenue? Or like how does it works usually? So this is the first part of the question, sir.

Okay. Mr. Chawla will reply to your query.

See, what is being done is that whenever any customer is not able to fulfill its commitment for lifting of the quantity, as per contract he has to pay use or pay. And accordingly, as LD, we record that as revenue for that particular year. And per the scheme approved, what we are doing is, we are taking provision for that amount every year based on the time-bound provisions.

Now if somebody is able to bring some material out of it in next financial year, now higher tariff is charged as applicable for that particular year, and that is recorded as my normal revenue.

Whereas whatever leftover amount after making provision, that is reversed as waiver because that waiver is with reference to LD charges.

It is not with reference to the revenue. Revenue is recognized in the respective year at the current tariff for the volume, which is brought out of that. So revenue will be at higher rate, whereas provision will be reversed as per the book debt. That is the normal process.

Understood, sir. And the other question was regarding the other terminals opening, particularly, if I talk about Chhara, where HPCL is thinking of to catering the captive refinery demand from there. So what's your outlook on the volume growth with respect to that?

Also, HPCL as other players intimated Petronet on their disinterest in taking the volumes. So as they have intimated Petronet in terms of their disinterest in taking the volumes. Also, are there any sort of volume compulsions with formal agreement as far as HPCL is concerned, for taking the volumes from the Petronet, particularly from Dahej or the Kochi terminal?

See, as Petronet, we do not have any agreement with HPCL. We have agreements with GAIL, Indian Oil, Bharat Petroleum, GSPC, Torrent on a long-term basis for capacity utilization. So those agreements are intact. We don't foresee any issue with that.

And as far as HPCL is concerned, so they have their own refinery. One is in Bombay and another is in Vizag, which is still not connected to national grid. So I cannot comment on how much quantum they will consume in those refineries. But other than that, we do not have any contract with HPCL. So there is no impact of HPCL volumes as far as Petronet is concerned.

The next question is from the line of Jaleshwar Rai, an individual investor.

Yes. I just wanted to understand the provisioning of reversal how did you arrive to the figures of minus INR233 crores for Q4 and about INR294 crores for FY '25?

So your -- can you please repeat the question? It was not audible probably.

Yes, I just wanted to ask that, again, my question is regarding the UOP provisioning and the reversal of it. So can you just explain the provisioning reversal which led to about the figures of minus INR233 crores for Q4 and about INR294 crores for FY '25...

See, as already explained by Director Finance that during the quarter -- can you hear? Yes, sir.

As already explained by Director Finance that during the quarter, offtakers have paid INR360 crores, which is pertaining to the Calendar Year 2021. Since most of the provision was already done against this 2021, so there was a reversal of provision during this quarter. So accordingly, after reversing this provision of around INR315 crores, there is -- net-net, there is a positive impact in this current quarter due to use or pay provisions.

Understood. But not all the provisioning have been done in that INR360 crores, which got reversed?

See, all cannot be reversed. It's only with reference to calendar year 2021, which was recognized in financial year '21-'22, that payment was received in March '25. So provision pertaining to that amount has been reversed during the quarter.

And sir, what is this INR183 crores of UOP charges which has waived off? So what does it mean? And when are these charges actually put on the customers?

See, as we have explained that the customer, whoever is able to bring material in the next 3 years, next 3 calendar years, for that waiver scheme is applicable, with a reference to that only quantity and value, which was recognized in that particular year.

So some of the customers who were levied LD in calendar year 2021 and calendar year 2022, they have been able to bring material to that extent and accordingly, waiver of INR151 crores pertaining to calendar year 2022 and around balance amount for 2021 has been given in this financial year or say calendar year till March -- December 2024. So that amount pertained to the waiver amount.

The next question is from the line of Kirtan Mehta from Baroda BNP Paribas Mutual Fund.

For the expansion from 17.5 million to 22.5 million, you mentioned that there are several SPAs signed by the industry players which have not yet booked the regas capacity. Could you highlight the quantum of sort of such outstanding SPAs where we have a possibility of sort to get the volume share, particularly for FY '26 and FY '27?

So of course, if you look at in last 2 financial years, I think India has signed deals close to almost 20 million tons -- at least 15 million to 20 million tons I will put it. So 7.5 million, of course, is the Petronet's Qatari volume. But in addition to this, the entire 8 million, 9 million tons, which GAIL, Indian oil, Bharat Petroleum and GSPC has signed, some of them might bring it under

the existing capacity agreements, which Petronet has like with GAIL 2.5 million ton, Indian oil 1.5 million ton, GSPC 2.25 million ton, Torrent 1 million ton.

So some of that volume might come under there. And some of them, if GAIL is looking to tie up additional volumes, they might bring in at Dahej Terminal, so we are already in discussions, but I cannot disclose for how much quantum at this point of time.

Sure, sir. This is helpful. And would you be able to share your volume guidance for FY '26?

Right, sir. And the last question was about, again, going back to the use or pay charges. You mentioned that INR151 crores and INR31 crores pertaining to CY '22 and CY '21 were given as a waiver. Would you also be able to highlight the number of cargoes that users have brought against this?

See, this waiver is with reference to the volume for which LD was charged. So waiver is particularly for that amount, which pertain to that volume. Now number of cargoes, around 33 TBTU volume pertaining to these 2 calendar years, which -- for which was eligible for waiver because there could be additional volume, so this is approximately around 33 TBTU. And where this volume drop in Q4 itself?

No, no. See, we have already explained this contract was for calendar year basis. So additional volume will be working -- working is done only in the calendar year. That means in September quarter of last 2024 or December quarter.

Just to sort of reconfirm my understanding, what you are saying is that this 33 TBTU of the additional cargoes were brought by the customers during the September quarter and the December quarter. Is that right to understand?

See, simple, you take understanding, it is based on the calendar year working because we have to cover -- first, the committed volume has to be brought. And thereafter, this additional volume has to be brought. So working is based on a calendar year. So nothing is booked in March.

Because of that, first, they have to bring their committed volume for this calendar year, which is calendar year 2025.

The next question is from the line of Hardik from ICICI Securities.

Hope I am audible. So if you look at the other expenditure, that has dropped to INR158 crores around. So just want to understand what would be our run rate going forward. And secondly, as you mentioned that as there was an INR187 crores reversal or waiver, so that would be over and above INR233 crores, right? Or how is it? How should one look at it? That's number one. Debabrata, please reply.

See, the other expenditure of INR150 crores -- almost approximately INR150 crores, that has come to the normal levels now because we have carved out the provisioning. You can see that there is a INR233 crores negative line item we have given separately. So the provisioning was actually included previously in the other expenditure.

That's why it was fluctuating quarter-on-quarter. So now it is at the normal of level of INR150 crores. And going ahead, this kind of normal level should be expected. The only thing that could be expected to be included in the forex loss again that we will give the guidance. And your next question was regarding the provisioning.

INR187 crores provision, so that was included in INR233 crores...

That was previously included. But with the new guidelines, we have to carve off now. Now accordingly, we have restated it also in the previous quarter and the year.

Okay. Got it. And my second question is regarding what was the regasification revenue for the quarter? And if you can just break down the trading gain and inventory gain? And also you gave a number for the Ind AS impact.

Yes, the regasification revenue is INR589 crores in the quarter. And the trading gain and inventory gain for the quarter are INR55 crores -- sorry, inventory gain INR55 crores and trading gain INR52 crores. And as far as the Ind AS numbers, there is a INR165 crores positive at the gross margin level, INR1 crores forex gain, INR7 crores positive at the other expenses level, the depreciation of INR80 crores and finance charges of INR58 crores. The net impact is INR36 crores in the quarter.

The next question is from the line of Nitin Tiwari from PhillipCapital.

So the numbers that you gave for the quarter, can you also help us for the same numbers for the financial year as well, the entire financial year? And secondly, how should we look at these numbers as far as Ind AS impact is concerned going ahead? Because if I remember right, I think there was a reversal expected post-FY '25 in terms of treatment of these figures. So if you can throw just some light on that? That would be my first question.

So can you please repeat the question? There was some background noise actually while you are putting the question.

Sure, sir. Sorry, sir. I was saying that the Ind AS impact... Nitin, some echo is there in your...

Yes. So let me give it a try again. So I was -- is it better, sir? Yes.

Yes. So I was saying that the Ind AS numbers that you gave for fourth quarter, can you also give the same for the entire financial year? That is one. And secondly, if I remember right, there was some reversal expected after FY '25 in terms of treatment of Ind AS basically impact. So I mean,

how should we look at these numbers going ahead after FY '25 as -- during FY '26 and '27. That was the first question.

Nitin, as we had explained before that the Ind AS impact will actually reverse from FY '25 that we had mentioned. And it has now reversed. You can see that FY '24, the net impact was zero.

The overall net impact was zero. And FY '25, the overall net impact is INR13 crores positive.

The breakups are INR619 crores at the gross margin level positive. There is a forex loss of INR62 crores and INR32 crores positive at other expenses level. INR328 crores of depreciation and INR248 crores of finance charges. So overall impact is INR13 crores positive.

The thing to be noted is that INR62 crores of forex loss was also there. Still it is INR13 crores positive. So going forward, you can expect positive Ind AS impact barring the forex loss.

So the quantum would be in the similar range, you have INR13 crores number that you had in FY '25.

See, those numbers cannot be said because few leases sir also restated according to lease conditions, etc. But you can say that the positive number can go up.

Understood, sir. And sir, my second question was actually related to volume. So you mentioned that about 33 TBTU was pertaining towards the UOP charges. So I mean if my understanding is right, the FY '24 doesn't -- didn't have any UOP-related volumes, right? FY '25, you had. So if we adjust for the 33 TBTU, then is it right to understand that on a like-to-like basis, we actually had a volume decline in FY '25?

See, this volume is, in any case, additional volume, which was processed during the year. This is mainly, you can say LD waiver is an accounting entry, which was pertaining to that. So it is the actual volume for this year only, which is processed in current year. By accounting method, we gave a benefit to the persons who have been imposed LD. And as a business -- long-term business association, management took a view that, that was a COVID year or market was not conducive, so we will -- this has to be a win-win situation. So we will give waiver for that volume. So practically, this is the volume for the current year only.

Okay. So I'll ask Vivek to supplement on your question regarding volume decline.

So volume, see, if we look at Dahej Terminal, it has processed -- as Petronet, we have processed 934 TBTU, the split between 876 TBTUs at Dahej and 58 TBTUs at Kochi so totaling to INR934 TBTU. And we expect at this moment, there has been a growth of around 2% at Dahej and similarly 2% at Kochi. So we expect this momentum to continue in times to come also. And with new long-term contracts getting signed into India, this gives an assurance that these volumes will come into our terminal.

No, sir, that's fair. What I was trying to get at is that given that our offtakers are asked to get an incremental volumes to set off against the outstanding use or pay, right? So if 33 TBTUs of incremental volume was brought in to set off against the outstanding UOP, so if you adjust for that 33 TBTU in this year, which is our total volume was 934.

So then, I mean, the net number that we are looking at is about 901 TBTU, which is on a like- to-like basis, like in FY '24, we had 919. So I mean, if this incremental volume was not brought in, then did we like face a decline in volume is what I was asking? Secondly, like what was the Gorgon volume brought in at Dahej in this quarter, if you can help me with that number as well.

Gorgon volume bought in at Dahej YTD is 16.9 TBTU. 15.9, sir? 16.9. For the entire financial year.

For the finance year. You can carve out the last 3 quarters. 3.9 in this current quarter.

The next question is from the line of Akash Mehta from Canara Bank, HSBC Life.

Yes. So two questions. So first is on Dahej utilization. So in terms of incremental the new capacity addition that has kind of come through, what kind of utilization are we kind of expecting in fiscal '26 and fiscal '27?

Okay. So I'll just repeat what Mr. Vivek Mittal has already told. So we are expecting a year-on- year growth of around 6% -- 5% to 6% of LNG consumption. So considering that and also considering the fact that Dahej strategic location, we are pretty confident of a good percentage utilization of the increased capacity.

Okay. And second is on tariffs hike. I mean this on Dahej as well as Kochi, you don't see there is any risk in terms of the 5% hike that you are kind of taking, so that should kind of continue going ahead as well, right? Yes.

The next question is from the line of Somaiah V from Avendus Spark.

So first question, given that spot LNG has marginally come off between March to say, April, a $2 kind of a decline, are we seeing change in customer sentiments? I mean utilization rates improving for us. If you could give some color on that. Yes.

Fertilizer, of course, continues to use natural gas. And CGD customers also, we believe that some of them are coming back. Morbi region, of course, is still not competitive vis- -vis propane prices, but if further declined, then propane can also be replaced in Morbi region.

Got it, sir. Sir, in terms of Kochi, the pipeline connectivity to the Bangalore pipeline, so what is the status there? And what is the outlook for us in terms of utilization in Kochi for this year?

So Kochi utilization will definitely get positively impacted once this pipeline comes through.

And we have been -- we are pretty much confident that this pipeline will be completed by the end of this calendar year. And it is -- this project is also being monitored at the PRAGATI at PM office, which monitors the critical projects.

Got it, sir. Sir, also on this capex breakup, so you did mention INR2,500 crores for petchem. So of the FY '26 plans, the remaining, which are the projects that we have been taking up? And also, is this the run rate that we should expect for the next couple of years in terms of capex?

Okay. So Dahej third jetty, that is another major project, which is currently going on. Then petchem, I have already told. Then Kochi terminal routine capex, we are expecting another INR80 crores to INR100 crores, and we are also in the process of putting up additional truck- loading facilities in Dahej as well as in Kochi, another INR75 crores to INR80 crores.

And we have corporate offices building in Dwarka, which we are putting up. So we have plans to spend around INR70 crores to INR80 crores on that, and we'll be very soon shifting to a new corporate office building in Nauroji Nagar, the new WTC, which has come up in Delhi. So the plan is to have a capex of around INR90 crores to INR100 crores on that.

Then we are also mandated by the government under the SATAT program for CBG plants. So we plan to spend around INR100 crores on that. Then Gopalpur LNG terminal also, we have a plan of around INR300 crores. So these are the broad expenditure heads, which we can share at this moment.

Sure. Sir, just a couple of follow-ups. So one, this INR300 crores that you mentioned for Gopalpur is part of FY '26 plan. And if you just give a bit more color on what are the total costs expected for Gopalpur and what are the time lines that we are looking at, that would be helpful.

So Gopalpur, we had already got the Board approval way back in 2022. And based on that, we have already started the land acquisition process. It is at an advanced stage. So going forward, we -- any terminal takes about 3 to 4 years to build and come up. The Board approved number for estimated capex is around INR2,300 crores.

Helpful, sir. Sir, I remember earlier, in terms of finalizing projects, so we had some kind of a back-to-back contract for going ahead with the project. So if you could just help us with that thoughts there?

Okay. Mr. Mittal will throw some light on that.

So you're referring to Gopalpur terminal or otherwise? Yes, sir, Gopalpur.

So we are already in discussion with our promoter offtakers for capacity booking or sale of volume. So those discussions are ongoing. But having said that, we are also open that even if there is no long-term commitment, we may look at setting up a terminal because we definitely

believe with the growth of natural gas market, specifically in the eastern region of the country, we can ensure good utilization of that terminal.

Got it, sir. Sir, in terms of any pipeline connectivity that we require there? Or more or less, it is there, it's just on the last mile...

There are already multiple pipelines, which are criss-crossing this region. One is the JHBDPL, second is Srikakulam-Angul pipeline, and third is Mumbai-Nagpur-Jharsuguda pipeline. So we'll be connected to all those 3 networks through SAPL, Srikakulam-Angul pipeline.

The next question is from the line of S. Ramesh from Nirmal Bang Equities Private Limited.

So if you're looking at the petrochemical project modules, what is the progress you're expecting on import of ethane and propane before you start the petrochemical production? And if you can shed some light in terms of whether you see some revenue from propane trading in FY '27? Or will it be dovetail into the start-up of the petrochemical project?

See, the feedstock for petrochemical plant is propane, not ethane. Ethane handling facilities we are setting up. So again, we are in discussion with a couple of players, either they bring in their own ethane and we provide tolling services for that or we import ethane and supply ethane to them. So both the models are open, and we are in advance discussion with some players over there. As far as propane is concerned, so propane trading is not -- we are envisaging in FY '27 for sure, it would be towards FY '28.

Okay. On the Gopalpur project earlier, it was an FSRU. So is there any finalization of the plan to make it a land-based terminal? Or are you still proceeding with the FSRU model?

No, no, we have tied up an MOU with the Odisha government also for the land. And now we are in advanced stage of the land procurement, and we are going to set up a land-based terminal.

Okay. So that will mean that project costs will go up to about INR5,000 crores, right? Yes exactly.

Okay. So with that, we bring the conference call to a close, let me thank all the investors and analysts who joined the call. We also thank the management and once again, congratulate Mr.

Mitra for taking over as Director of Finance, and I'll hand over the call to the management for their closing remarks. Thank you very much, sir.

So thank you. Thank you, till we meet again.

Thank you. On behalf of Nirmal Bang Equities Pvt Ltd, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. *****