GAIL (India) Limited takes a step towards Greener Economy with 20-yr deal with Gazprom
In a world where everyone is looking for an environment friendly, sustainable energy solution, Natural Gas emerges as an easy winner. By 2020, with India’s projected economic growth of about 8 %, Natural Gas is increasingly becoming attractive against coal and oil due to their heavier carbon emissions. The gap between domestic demand and supply is widening due to lackluster supply of domestic gas in India. Accordingly, all attentions are now on import of LNG – Liquefied Natural Gas. GAIL (India) Limited, on its part has been trying to get the maximum possible to make good this shortfall. Recently, GAIL has signed a 20-year liquefied natural gas (LNG) sales and purchase agreement (SPA) with Russian Gas major – Gazprom Marketing and Trading Singapore (GM&TS).
“Natural Gas Could Be Bigger Than the Internet…” – Jack Welch
According to this 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 year 2018-19. LNG will come from Gazprom’s Shtokman production facilities (130 TCF reserves), optimized 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.
Such deal reaffirms both the strong partnership in developing India as one of the core markets for LNG business and the Indo-Russian trade relationship. 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. This is part of GAIL’s endeavor to create a long-term sustainable growth pathway – “Tomorrow is Yours”