State-run Petronet signs long term LNG agreement with QatarEnergy

Petronet LNG also said that similar to earlier agreement of 1999, the LNG volumes under the new contract shall also be offtaken by GAIL (India), IOC, BPCL

India and Qatar signed an agreement on February 6 to extend the contract for supply of 7.5 million metric tonnes per annum (mmtpa) of liquefied natural gas (LNG) for another 20 years beyond 2028.   State-run Petronet LNG announced that it has successfully concluded and executed long term contract purchase of LNG with QatarEnergy.

The latest deal is an extension of an existing LNG supply contract of around 7.5 MMTPA LNG sale & purchase agreement on FOB basis, signed on 31st July 1999 for supplies till 2028.  Under the new agreement, LNG supplies will be made on delivered basis commencing from 2028 till 2048.

The LNG supplying company also said that similar to earlier agreement of 1999, the LNG volumes under the new contract shall also be offtaken by GAIL (India) Limited (60 percent), Indian Oil Corporation Limited (30 percent) and Bharat Petroleum Corporation Limited (10 percent) after regasification primarily from Dahej Terminal of PLL on substantially back-to-back basis.

This agreement between PLL and QatarEnergy "will ensure energy security of the India and assure continued supplies of regasified LNG to major consuming sectors like fertilisers, CGD, refineries & petchem, power and other industries," it added.

India imported about 21 million tons of LNG in 2023, Bloomberg reported on February 5 citing  ship-tracking data. Deliveries are expected to reach at least 40 million tons by 2030 as new import terminals start up, according to the traders, the report added.

Commenting on the agreement, Akshay Kumar Singh, MD & CEO, Petronet LNG Limited said, “This agreement will provide energy security and ensure stable & reliable supply of clean energy and help India in its stride towards greater economic development.”

He further added that the long-term LNG purchase agreement with QatarEnergy will strengthen the existing relationship between the two Companies.