SINGAPORE: GAIL India Ltd., the largest gas distributor in India, is looking to purchase an equity stake of up to 26% in a liquefied natural gas (LNG) liquefaction facility or project in the United States, a statement issued the company read.
Due to western sanctions on Moscow over its invasion of Ukraine, Russia's Gazprom Marketing and Trade (GMTS), which is owned by GAIL, had supply crisis last year. As per the document dated February 16, the company is "exploring the option" to purchase equity from an existing or post-commissioning of a projected LNG liquefaction plant or project in the United States, either directly or through its affiliates.
The amount that the Indian gas distributor has set aside for any potential deals was not specified.
In addition,"GAIL, directly or through any of its affiliates, is interested in sourcing 1 million tonnes per annum of LNG on a free-on-board basis for a period of 15 years from the LNG liquefaction facility or project," it said.
The document added that he LNG supply contract time might be mutually extended by an additional 5 or 10 years and that supplies would likely start in the fourth quarter of 2026. The last date for interested entities to submit their bids to GAIL is March 10, the document said.
According to the head of finance at GAIL, the company is searching for long-term gas import agreements to make up for its interrupted supply and is in talks with Abu Dhabi National Oil Co (ADNOC) and other partners to obtain gas to meet local demand.
In 2012, GAIL and GMTS agreed to a 20-year agreement for the purchase of an average of 2.5 million tonnes of LNG annually.
Gazprom Marketing and Trade was a unit of Gazprom Germania, now called SEFE, but the parent abandoned the business last April after the western sanctions.