Deliberations on LNG Likely During Trump’s India Visit

Gas comprises about 6.2% of India’s primary energy mix, far behind the global average of 24%.

SEATTLE (Oil Monster): With India pushing for a gas-based economy, discussions around liquefied natural gas (LNG) may feature during the upcoming visits of Qatar energy minister and US President Donald Trump here, said India’s oil minister Dharmendra Pradhan on Thursday.

This comes in the backdrop of India— the world’s fourth-largest LNG importer— building up its LNG portfolio with Indian firms having inked long-term LNG contracts totalling 22 million metric tonnes per annum (mmtpa). India consumes around145 million standard cubic meters a day (mmscmd) of gas.

The latest case in point being US’ Tellurian Inc. inking a $7.5 billion agreement for India’s Petronet LNG Ltd to buy a stake in its proposed liquefied natural gas (LNG) terminal in Louisiana, in what could potentially be one of the largest foreign investments in the US for shipping shale gas abroad.

India is also in engaged with Russia for long-term energy deals, Pradhan told reporters at the National Conclave on Emerging Opportunities in Natural Gas Sector here.

Trump’s impending visit to India—the sixth-largest buyer of US LNG—also comes at a time of growing uncertainty in the global energy market against the backdrop of Iran's attacks on Americans in response to a U.S. drone strike that killed Iranian military commander Qassem Soleimani in Iraq, further escalating tensions in the Persian Gulf.

Gas comprises about 6.2% of India’s primary energy mix, far behind the global average of 24%. The government plans to increase this share to 15% by 2030. India’s gas demand is expected to be driven by the fertilizer, power, city gas distribution, and steel sectors. India’s energy demand is expected to grow at 4.2% per year over the next 25 years.

Also, India has been trying to renegotiate its LNG contracts. Indian firms have been exploring strategies such as time swap of volumes, destination swaps and contract on free on board basis to reduce the final fuel price. Some of the successfully negotiated contracts are new deals with Qatar’s RasGas Co. and Exxon Mobil Corp. Apart from the US, new natural gas suppliers such as Mozambique, Tanzania, Egypt, Israel, Canada and Cyprus are expected to enter the LNG market, helping consumers get better prices.

India, the biggest emitter of greenhouse gases after the US and China, plans to reduce its carbon emissions by 33-35% from its 2005 levels by 2030, as part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.

Courtesy:www.livemint.com