GAIL secures 4.5 MMTPA of LNG through Petronet's extended QatarEnergy contract

7 Feb 2024 , 11:26 AM

The state-owned GAIL India Ltd. said on Tuesday, February 6, that it will purchase about 4.5 MMTPA (million metric tonnes per annum) of LNG from Petronet LNG Ltd. PLL recently renewed a long-term LNG contract worth 7.5 MMTPA with QatarEnergy.

In accordance with the updated LNG SPA (sell and purchase agreement), GAIL India will essentially offtake its part of the volumes back-to-back. This translates to $60 million in shares.

In the meantime, QatarEnergy and Petronet LNG Ltd (PLL), the biggest gas importer in India, have successfully finalised and carried out an LNG sale and purchase agreement (LNG SPA) for the long-term purchase of about 7.5 MMTPA of LNG.

This falls within the expansion of an already-existing LNG SPA for the sale and purchase of LNG on a FOB basis, with a capacity of about 7.5 MMTPA, signed on July 31, 1999, and valid for supplies through 2028. LNG supplies will be provided on a delivered (DES) basis under the terms of the new deal, starting in 2028 and lasting until 2048.

As in the previous 1999 deal, GAIL India will take up 60% of the LNG volumes under the new SPA, followed by Indian Oil Corporation Ltd (30%) and Bharat Petroleum Corporation Ltd (10%), following regasification principally from PLL's Dahej Terminal, almost back-to-back.

The business further stated that this LNG SPA between PLL and QatarEnergy will guarantee continuous supply of regasified LNG to important consuming sectors including power, petrochemical, fertilisers, CGD, refineries, and other industries, as well as India's energy security.

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