GAIL uses Shell's Hazira terminal to import LNG

In a bid to diversify portfolio, state-owned gas utility GAIL India Ltd has imported its first shipload of LNG at rival Royal Dutch Shell's Hazira terminal in Gujarat.

GAIL, which part-owns Petronet LNG that operates 10 million tonnes Dahej terminal in Gujarat and operates 5 million tonnes a year capacity Dabhol plant in Maharashtra, last weekend imported a cargo of liquefied natural gas (LNG) at Hazira.

The company previously imported all the LNG it bought from overseas either at Dahej or at Dabhol.

"We couldn't import at Dahej since it was facing haulage problem so we decided to use Hazira terminal," a top GAIL official said.

This is the first time since India started importing LNG in January 2004 that GAIL, the nation's largest gas marketing and transmission firm, has used a privately operated terminal for imports.

The cargo imported a Hazira came from French energy giant GDF Suez which whom GAIL had in 2012 signed a term contract to buy 0.8 million tonnes of LNG.

"If our customers need gas, we are open to using Hazira more often," the official said.

GAIL, he said, is also talking to Shell for buying LNG on a short-term contract. "The talks are still on but nothing has been finalised."

The company is aggressively scouting for LNG the world over to meet the nation's growing gas demand, which is expected to grow from 58 billion cubic metres in 2012 to 220 billion cubic metres in 2020, representing a compounded annual growth rate of over 18 per cent.

It had in August 2012 signed a contract with GDF bot buy 12 cargoes or shiploads (0.8 mn tonnes) from 2013 to 2014.

GDF supplied six cargoes of LNG in 2013 beginning January and an equal number are to come in 2014. It supplies one cargo once in two months, most probably from its Yemen portfolio.

The price of LNG would be linked to prevailing oil rates.

GAIL had previously roped in GDF Suez for a 3.5 million tonnes a year floating LNG import terminal it plans to set up off the east coast. The French firm would have 26 per cent stake in the project.

GDF, which holds 10 per cent stake in Petronet LNG Ltd, had in November 2011 agreed to supply 9 cargoes of LNG to the nation's largest liquefied natural gas importer (Petronet).

GAIL as well as Indian Oil Corp (IOC), Bharat Petroleum Corp (BPCL) and Oil and Natural Gas Corp (ONGC) hold 12.5 per cent stake each in Petronet.

GAIL has been expanding its global presence to secure gas supplies. It had earlier signed a 20 year Sales and Purchase Agreement with Sabine Pass Liquefaction LLC, a unit of Cheniere EnergyPartners, USA for supply of 3.5 million tonnes per year of LNG beginning 2017.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Subdued crude oil prices offer an excellent opportunity for India

    In Mid-June, when most of us probably first heard of the ISIS posing a serious threat to stability in West Asia, international crude oil price suddenl

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

M S Swaminathan

Strengthening family farming in India

The United Nations declared 2014 as the International Year of ...

Kuruvilla Pandikattu SJ

Roots and routes as our foundation

Ethnicity and identity linked to both territory and culture. The ...

Gautam Gupta

Don’t let success kill the essence of the concept

In 1999 when my mother started her own label, we ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture