Petronet near deal for annual import of 3.5 million tonnes of LNG

21 July 2008

Mumbai: Petronet LNG Ltd is close to striking a long-term deal to import 3.5 million tonnes of liquefied natural gas (LNG) a year, reports quoting its chief executive said.

Petronet, reports said, is in advanced stage of negotiations and a deal is expected in the next couple of weeks. Petronet plans to import 1.8 million tonnes of LNG in the first year beginning August 2008 and 3.5 million tonnes from 2009, according to the reports.

Petronet,  meanwhile, has been in talks to secure Exxon's entire stake of 3.75 million tonnes per annum (mtpa) in Australia's Gorgon project. Exxon, which had a 2.5 mtpa share in the project saw it increase to 3.75 mtpa after project operator Chevron Corp raised the project size to 15 mtpa.

Petronet and Exxon have already finalised a draft agreement under which Petronet would buy Exxon's share of LNG from the project for 25 years.

Chevron owns 50 per cent stake in Gorgon, while Exxon and Shell hold 25 per cent each. Petronet will have to give a final price quote to Exxon by 31 July. A deal is expected in the last quarter of 2008.

Petronet plans to bring this LNG through its upcoming terminal at Kochi or the existing one at Dahej.