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Petronet LNG expansion faces lower utilization risk on high LNG prices

Dahej terminal capacity rises to 22.5 million tonnes per annum from 17.5 million tonnes per annum at end-FY26, but forecasts point to utilization falling to 70% in FY27 before recovering in FY28.

Reported · Written up by our desk · Asia

Petronet LNG’s Dahej terminal capacity expansion shifts attention to how fast utilization can climb, with high LNG prices expected to keep rates under pressure into FY27, according to analysis cited by LiveMint Markets. The Dahej terminal’s capacity increased to 22.5 million tonnes per annum from 17.5 million tonnes per annum at the end of FY26.

Motilal Oswal Financial Services expects utilization to drop to 70% in FY27 from 91% in FY26, before recovering to 82% in FY28. The report links weaker utilization expectations to high spot LNG prices that have discouraged customers from committing to additional long-term volumes.

JM Financial Institutional Securities expects spot LNG prices to moderate from FY28 as significant new global liquefaction capacity comes online over the next 12 to 18 months. LiveMint Markets also notes that lower LNG prices could make supply more affordable for industrial consumers, helping Petronet monetize its added capacity.

The same analysis projects that Dahej and Kochi volumes could increase to 18.5 million tonnes per annum and 1.5 million tonnes per annum in FY28, respectively.

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