State-owned natural gas utility GAIL announced 6 March 2018
the dispatch of its first US-sourced Liquefied Natural Gas (LNG) shipment under
a 20-year Sale Purchase Agreement (SPA) signed with US’ natural gas
“The cargo has been loaded on-board GAIL’s first chartered LNG ship ‘Meridian
Spirit’. This LNG cargo originated from Cheniere Energy’s LNG export facility
at Sabine Pass LNG project. The cargo will discharge LNG at Dhabhol terminal of
GAIL on or around 28thof this month,” GAIL said in a statement.
The ship, which set sail yesterday from Cheniere’s LNG export facility at
Sabine Pass LNG terminal in Louisana, was flagged off in the presence of GAIL
Chairman and Managing Director B.C. Tripathi, Cheniere Energy CEO Jack Fusco,
Counsel General of India in Houston, Anupam Ray, as well as representatives
from Cheniere Energy and GAIL.
“With supplies commencing from US, GAIL will have a diversified portfolio both
on price indexation and geographical locations. This long-term agreement would
go a long way in strengthening relationship between GAIL and Cheniere and
reinforcing India-US trade ties,” Tripathi said in a statement.
Under the SPA signed on 11 December 2011, GAIL would purchase around 3.5
Million Tonne of LNG per year from Sabine Pass. “The deal between Cheniere and
GAIL aligns with the Strategic Energy Partnership announced by U.S.
President Donald Trump during Indian Prime
Minister Narendra Modi’s
visit to Washington last summer; the two leaders agreed to leverage new
opportunities and elevate cooperation,” Barry Worthington, Executive Director at
United States Energy Association (USEA) said in a statement.
USEA is the US member committee of the World Energy Council and a United
Nation- accredited global energy body with Cheniere Energy as one of its
members. “India is trying to increase its use of natural gas. The fuel
comprises about 6 percent of India’s energy mix, while its government is taking
steps to move the needle closer to 15 percent within five years. As India tries
to secure energy supplies and reduce emissions by using more natural gas, the
U.S. is a logical energy partner,” Worthington added.
India primarily imports LNG from Qatar and Australia under long-term contracts
and has been trying to diversify its natural gas sources. Also, after former US
President Barack Obama lifted US’ 40 year-old oil export ban, Indian oil and
gas companies -- which have been trying to diversify their crude oil sources --
in response bought shipments of US crude to check for cost competitiveness and
its compatibility with Indian refinery configuration.
Cheniere is currently operating and constructing its Sabine Pass LNG facility
in Louisiana and is constructing a second liquefaction facility near Corpus
Christi, Texas. Cheniere is expected to be the fifth largest global supplier of
LNG with the completion of both the projects.