Through a joint venture firm with Shapoorji Pallonji, Malaysian floating production vessel company Bumi Armada has struck a deal to set up and operate a floating storage regasification unit (FSRU) in Mumbai Harbour.

SP Armada Clean Energy Ventures Private Limited (SPACEVPL), Bumi Armada's joint venture with Shapoorji Pallonji entered into a license agreement on May 18, 2021,  with the Board of Trustees for the Port of Mumbai to set up, operate, and maintain an FSRU in Mumbai Harbor for a period of 30 years.

Under the license agreement, the parties have 270 days from the date of execution of the agreement to fulfill certain conditions before the agreement becomes effective.

The preconditions include Bumi Armada's JV securing financing, applicable permits for the start of construction works, and signing of the agreement between the FSRU owner/ charterer and SP Armada Clean Energy Ventures Private Limited for providing the FSRU for the license period.

At the end of the license period, ownership of the infrastructure, including the pipeline and jetty, except for the FSRU, is planned to be transferred to the Port of Mumbai.

"Further details relating to the project will be announced when there are further material developments," Bumi Armada said.

"In order to achieve a financially successful project, SPACEVPL will have to sell the terminal capacity and regasification to potential customers. To this end, there is a focused marketing strategy in place," the company said.