GAIL, K LINE, JM Baxi ink LNG shipping equity pact

New Delhi: GAIL (India) Limited, Kawasaki Kisen Kaisha, Ltd. (“K” LINE) and J M Baxi Marine Services have signed a term sheet for equity participation in a ship-owning company established in Singapore, marking a step towards strengthening India’s LNG shipping capabilities. The pact was signed in the presence of Union Petroleum minister Hardeep Singh Puri.

Under the arrangement, GAIL has entered into a long-term charter with the ship-owning company starting from 2027. The LNG vessel is currently under construction at a shipyard in South Korea. GAIL’s proposed equity investment in the ship-owning company, subject to approval from the Department of Investment and Public Asset Management (DIPAM), will be routed through its wholly owned subsidiary, GAIL Global IFSC Limited, which is registered at GIFT City, Gujarat.

GAIL Chairman and Managing Director Sandeep Kumar Gupta said: “Taking equity in a shipping company while also serving as a charterer is a strategic alignment of interests. With this equity investment, GAIL will be having ownership in two LNG ships in partnership with reputed Japanese companies. Increasing ownership of ships by Indian companies is a move towards achieving Prime Minister’s vision of ‘Aatmanirbhar Bharat’ in the shipping sector.”