Mitsubishi Heavy Industries, Ltd. (MHI) will build two LNG storage tanks at Indian Oil’s proposed Ennore terminal in south India.

The LNG tanks will be the main facility at the first LNG receiving terminal to be constructed on India's east coast. This is also the first LNG storage tank order that MHI has received from India, the Japanese firm said late last month.

Construction of the tanks is slated to begin this month and is expected to be complete by 2018.

The ordered LNG tanks are high-capacity storage tanks capable of holding 180,000m3 each and will be installed at an LNG terminal that IndianOil will build near Ennore port, approximately 25 kilometers north of Chennai on the Bay of Bengal. LNG imported to the terminal will be supplied as feedstock to fertilizer plants, and to utility company power generation plants for use as an alternative fuel. Plans also call for the use of LNG as city gas in urban areas in the future. The terminal will initially have the capacity to handle five million metric tonnes per annum (MMTPA), expanding to 15 MMTPA in the future.

Indian Oil will hold 45 per cent stake in the planned LNG import terminal while 50 per cent interest will be offered to financial institutions. Tamil Nadu government enterprise, TIDCO will have 5 per cent holding.

Ennore will be the third LNG terminal on the east coast with state-owned GAIL India Ltd building a facility at Kakinada in Andhra Pradesh and Petronet LNG Ltd proposing a 5 million tons facility at Gangavaram in Andhra Pradesh. India currently has four LNG import terminals, all on the west coast -- Dahej and Hazira in Gujarat, Dabhol in Maharashtra and Kochi in Kerala.