GAIL synergises with Azerbaijan’s state oil firm for LNG opportunities

State gas utility GAIL India Ltd on Monday said it has signed an initial agreement with State Oil Company of Republic of Azerbaijan (SOCAR) for jointly pursuing LNG opportunities.

Under the Memorandum of Understanding, 'GAIL and SOCAR intend to jointly pursue LNG opportunities through capacity booking, LNG procurement and promotion of LNG projects globally,' the company said in a statement here.

Both companies shall also cooperate in optimisation of liquefied natural gas (LNG) marketing, sourcing and shipping requirements. In addition, GAIL and SOCAR will pursue business opportunities in upstream assets across the world and joint investment in petrochemical projects.

GAIL Chairman and Managing Director B C Tripathi said: 'Skills and strengths of both the parties would be leveraged to explore business opportunities jointly in natural gas and LNG business including new business developments across the gas value chain.' Meanwhile, GAIL has extended by over a month the deadline for submission of bids for nine newly built LNG ships it wants to hire to transport liquid gas from the US. In a notice, GAIL said the last date for bidding has been extended till 4 December from 30 October previously.

The company has asked ship builders to quote daily hire charges for the freshly built LNG tankers in lots of three. It has conditioned that one ship out of every lot of three ships each would be built in India.

In the tender, GAIL has given Indian shipbuilders six years to deliver the ships as opposed to two-and-half year deadline for foreign firms. Worldwide, about 379 LNG ships are operating and another 105 ships are being built/ordered. The specialised carriers are mostly built in South Korea and Japan by companies such as Samsung and Daewoo.

In recent years, China has also started making LNG ships. In two deals, GAIL has contracted 5.8 million tonnes per annum of LNG from US for 20 years, beginning 2017-18. It has to arrange for ships for transportation of the liquefied natural gas (LNG).