GAIL signs 20-year LNG sales and purchase pact with Gazprom
2 Oct 2012 12:34 AM GMT
GAIL [India] Limited has signed a legally binding 20-year liquefied natural gas [LNG] sales and purchase agreement [SPA] with Gazprom Marketing and Trading Singapore [GM&TS], a 100 per cent wholly-owned subsidiary of Gazprom Marketing & Trading.
Under the terms of the agreement, GAIL will receive 2.5 million tonnes of LNG per annum [equivalent to approximately 130 million MMBtu or 3.5 bcm or 122 bcf per annum] over a period of 20 years expected to start from the year 2018-19.
LNG will come from Gazprom’s Shtokman production facilities [130 tcf reserves], optimised and supplemented by GM&T’s global trading portfolio and capabilities. Under the contract, LNG will be sustainably priced with an oil-indexed formula and delivered to Dahej, Dabhol and Kochi terminals in India.
This agreement is a key milestone for both GAIL and Gazprom which reaffirms both their strong corporate partnership in developing India as one of the core markets for LNG business, and the Indo-Russian trade relationship.
This deal will lead to introducing a favourable market GAIL is thus introducing World’s larget LNG reserves in LNG market.
Commenting on the development, B C Tripathi, chairman and managing director, GAIL [India] Limited said, ‘This long-term LNG supply agreement with Gazprom, which holds the world’s largest gas reserves, is another milestone in Indian–Russian Energy Cooperation.
The deal with Gazprom reinforces GAIL’s commitment to facilitate the development of the Indian market for which US$6 billion investments are being made by GAIL in creating Natural Gas infrastructure. The deal is introducing one of the world’s largest gas reserves to the global LNG market, thereby creating an environment for competition.
It also marks GAIL’s efforts to create a well-diversified and secured supply portfolio to meet the ever growing energy requirements of the Indian economy and enable sustainable long-term growth for GAIL’.
Speaking on this partnership, Vitaly Vasiliev, CEO of Gazprom Marketing & Trading, said: ‘We are delighted to have signed this agreement with GAIL, during a period of rising demand for LNG in India. We are looking forward to working together with GAIL to help meet India’s expanding gas demand whilst securing a long-term market for Russian gas.’
In December 2011, GAIL had signed an agreement to buy 3.5 million tonnes of LNG a year for 20 years from Houston-based Cheniere Energy Partners LP’s Sabine Pass terminal in western Cameron Parish, Louisiana.
This year in August, it signed an agreement with GDF Suez to buy 12 cargoes of LNG or about 0.8 million tonnes of the fuel from 2013 to 2014.
Under the terms of the agreement, GAIL will receive 2.5 million tonnes of LNG per annum [equivalent to approximately 130 million MMBtu or 3.5 bcm or 122 bcf per annum] over a period of 20 years expected to start from the year 2018-19.
LNG will come from Gazprom’s Shtokman production facilities [130 tcf reserves], optimised and supplemented by GM&T’s global trading portfolio and capabilities. Under the contract, LNG will be sustainably priced with an oil-indexed formula and delivered to Dahej, Dabhol and Kochi terminals in India.
This agreement is a key milestone for both GAIL and Gazprom which reaffirms both their strong corporate partnership in developing India as one of the core markets for LNG business, and the Indo-Russian trade relationship.
This deal will lead to introducing a favourable market GAIL is thus introducing World’s larget LNG reserves in LNG market.
Commenting on the development, B C Tripathi, chairman and managing director, GAIL [India] Limited said, ‘This long-term LNG supply agreement with Gazprom, which holds the world’s largest gas reserves, is another milestone in Indian–Russian Energy Cooperation.
The deal with Gazprom reinforces GAIL’s commitment to facilitate the development of the Indian market for which US$6 billion investments are being made by GAIL in creating Natural Gas infrastructure. The deal is introducing one of the world’s largest gas reserves to the global LNG market, thereby creating an environment for competition.
It also marks GAIL’s efforts to create a well-diversified and secured supply portfolio to meet the ever growing energy requirements of the Indian economy and enable sustainable long-term growth for GAIL’.
Speaking on this partnership, Vitaly Vasiliev, CEO of Gazprom Marketing & Trading, said: ‘We are delighted to have signed this agreement with GAIL, during a period of rising demand for LNG in India. We are looking forward to working together with GAIL to help meet India’s expanding gas demand whilst securing a long-term market for Russian gas.’
In December 2011, GAIL had signed an agreement to buy 3.5 million tonnes of LNG a year for 20 years from Houston-based Cheniere Energy Partners LP’s Sabine Pass terminal in western Cameron Parish, Louisiana.
This year in August, it signed an agreement with GDF Suez to buy 12 cargoes of LNG or about 0.8 million tonnes of the fuel from 2013 to 2014.
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