11 December 2018, News Wires — Top Indian gas importer Petronet LNG is looking to sign a deal in a year’s time to buy at least 1 million tonnes of U.S. natural gas annually for a period of up to 10 years, as it pushes to diversify its supply sources beyond the Middle East.
As part of any deal, the firm could potentially take a stake in a U.S. liquefied natural gas (LNG) project, said Petronet’s managing director, Prabhat Singh.
“The U.S. market is open compared to other markets where the state is (often) the controller of minerals,” Singh told Reuters late last week.
“The U.S. offers lots of opportunities and we would like to explore that properly and make a venture (there),” he said.
Petronet currently runs a 15 million tonnes per annum (mtpa) liquefied natural gas (LNG) regasification site at Dahej in the western state of Gujarat and a 5 mtpa plant at Kochi in southern India.
It has long-term deals to buy 10 mtpa of LNG, with 8.5 mtpa of that coming from Qatar’s RasGas.
Singh said Petronet was in talks with various companies including Tellurian Inc about a potential U.S. deal.
Singh had said in November that Petronet and ONGC Videsh were jointly in talks to buy a stake in Tellurian’s proposed Driftwood project in Louisiana.
“If the pricing is right then India has appetite for huge volumes,” he said last week.
Natural gas accounts for about 6.5 percent of India’s overall energy needs, far lower than the global average. The government wants to lift that to 15 percent in the next few years.
“The U.S. market is so developed that niche service providers are available on a shoestring budget, which means less overheads,” Singh said.
A glut of natural gas in the United States in the wake of the rapid development of shale fields there has kept benchmark U.S. prices for LNG at almost half Asian levels.
Meanwhile, Singh said Petronet was also in talks to invest in exploration and LNG projects in Qatar, as well as continuing to scout for opportunities in Bangladesh and Sri Lanka.
Australia overtook Qatar as the world’s largest exporter of LNG for the first time in November, data from Refinitiv Eikon showed on Monday.