NEW DELHI (Reuters) – Gas transmission firm GAIL (India) Ltd has signed an agreement with GDF Suez to buy 12 cargoes of liquefied natural gas (LNG) or about 0.8 million tonnes of the fuel from 2013 to 2014, the Indian firm said in a statement.
“This agreement will contribute to supply the Indian gas market, which is expected to grow from 58 billion cubic meters in 2012 to 220 billion cubic meters in 2020,” the company said in a statement, referring to a study by consultants CERA.
GAIL Chairman and Managing Director B C Tripathi said, “This agreement with GDF Suez is yet another step by GAIL to bridge the demand supply deficit of the Indian market in the medium term.”
GAIL and GDF Suez are already working on a 3.5 million tonnes a year floating LNG import terminal the Indian company plans to set up off the east coast. The French firm would have a
26 percent stake in the project.
India, Asia’s third largest economy, is scouting for LNG deals abroad as problems in the gas-producing D6 block off India’s east coast, operated by Reliance Industries have curtailed output there, while state-run ONGC (ONGC.NS) struggles to arrest declining production from its ageing fields.
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 in 2017.
(Reporting by Nidhi Verma;Editing by Sofina Mirza-Reid)