India may increase gas imports from US at the right price: Pradhan

The Dollar Business Bureau

Oil Minister Dharmendra Pradhan said on Monday that India might raise its imports of liquefied natural gas (LNG) from the US at the right prices, even though various other importers in the country are trying to do away with the costly oil supplies from the US.

State-owned company Gas Authority of India Ltd (GAIL) entered into a swap agreement with the trading company Gunvor to supply some of its LNG from the US as the company is trying to reduce costs for price-sensitive buyers following a steep decline in the Asian spot prices that made its US LNG unattractive, reported a leading media agency citing sources.

GAIL Ltd has signed a deal for most of its capacity from one of the Sabine Pass Terminal' liquefaction trains in the Gulf Coast of US, with expected delivery to begin later this year.

The Oil Minister said that the supplies of LNG and also of crude from US may increase to India at the right prices.

“The kind of reasonable price we are finding in America, we might have some more investment in America,” Pradhan said during a briefing to reporters at CERAWeek in Houston.

In 2011, GAIL had signed a 20-year contract with the Sabine Pass Liquefaction LLC, a part of Cheniere Energy Inc, for supplying 3.5 million tonnes of gas a year.

As per the recent deal, Gunvor will supply 15 cargoes or around 8 lakh tonnes of LNG to India’s west coast starting from April to December, whereas GAIL will sell around 6 lakh tonnes in 2018 from the Sabine Pass Liquefaction at a premium as per its pricing formula.

The present booking capacity of India for LNG is about 6 million tonnes a year. Currently, its crude imports are about 4.5 million barrels a day (bpd), Pradhan said.