GAIL's first chartered LNG vessel from US arrives at Dabhol
31 March 2018
Gail (India) Ltd on Thursday received the first LNG cargo from the US under long-term contract, marking a new beginning in Indo-USA energy partnership and trade.
The cargo was delivered to Dabhol Konkan LNG Pvt Ltd at the Dabhol PLG terminal.
The first charter-hired vessel, MV Meridian Spirit, arrived after a 25-day voyage and docked for unloading in the presence of union minister of petroleum and natural gas and skill development and entrepreneurship Dharmendra Pradhan, and, minister counselor for commercial affairs, US Embassy, Patrick Santillo and Gail CMD B C Tripathi.
“Commencement of LNG supplies under the Henry Hub indexed contracts is significant for GAIL and the Indian markets as well, “a Gail release stated.
Speaking on the occasion, petroleum minister Dharmendra Pradhan said the government was working towards making India a gas-based economy, adding that the arrival of the first LNG cargo from US was a significant milestone in the direction of realising availability of natural gas from diversified sources.
However, he said, adequate investments in natural gas infrastructure, including pipeline, LNG import terminal and city gas distribution network, is also a focus area for the government.
“GAIL will have a portfolio mix of LNG indexed to Henry Hub (HH) and crude oil. GAIL has 5.8 million tonne per annum (MTPA) of US LNG in its portfolio. GAIL shall be receiving around 90 cargoes per annum from Sabine Pass and Cove Point LNG terminals,” according to the Gail release.
The arrival of this LNG vessel comes close on the heels of formation of Konkan LNG Private Limited, a subsidiary of GAIL, which has recently been demerged from RGPPL.
India’s trade with US is expected to increase exponentially with imports of LNG and crude oil in the coming years. GAIL alone would be procuring approx. $2 billion worth of LNG per annum from US from financial year 2018-2019, the minister stated.
The US has abundant supply of shale gas and the long term LNG contracts signed by Indian companies with US provide India with an access to secure supply source at stable prices which will result in geographical diversification and energy security.
Total bilateral trade (goods and services) between India and US increased at a CAGR of 11.4 per cent from $20 billion in the year 2000 to over $126.1 billion in the year 2017. India’s trade with the US is expected to increase owing to large scale imports of LNG and crude oil in coming years.