State-owned Gail India Ltd [ Get Quote ], which has been given the task to source fuel for restarting the Dabhol power project in Maharasthra, is talking to LNG suppliers in Qatar, Australia [ Images ], Malaysia, Oman and UAE.

"We are in advanced negotiations with suppliers in Qatar, Oman, UAE, Australia and Malaysia. We hope to tie-up LNG soon," GAIL chairman and managing director Proshanto Banerjee told reporters in New Delhi [ Images ].

The 2,184 MW Dabhol project, shut since June 2001 over payment dispute with its principal buyer Maharashtra [ Images ], needs 2.1 million tonnes of liquefied natural gas per annum.

GAIL plans to import 0.64 million tonnes LNG in 2006 to fire 740 MW Phase-I and 2.83 million tonnes in 2007 when the 85 per cent complete 1,444 MW Phase-II also comes on stream.

Banerjee said GAIL anticipates that it would be able to complete the 5 million tonnes a year capacity LNG terminal adjacent to the power plant in 12 months.

National Thermal Power [ Get Quote ] Corp, which is to complete the unfinished portions of the power plant and operate it, would restart the Phase-I by July 2006 and complete the 1,444 MW Phase-II by end 2006.

Asked if LNG suppliers were quoting a price of about $7 per million British thermal unit, he said: "We are in discussions with the suppliers."

GAIL had previously projected power from the plant to cost Rs 2.3 to Rs 2.5 per kwh (unit) at ex-ship LNG price of between 3.65 and 4.25 dollars per mBtu.