Indian Majors Look to Bid For US LNG Hubs

Indian energy majors such as Reliance Industries, Oil and Natural Gas Corporation and GAIL want to buy shares in liquefied natural gas (LNG) terminals on the east coast of the United States for shipping gas to India at about $9.5 per million metric British thermal unit (mmBtu), which will be over 50% cheaper than current imports. 

"Indian companies with shale gas assets are interested in acquiring an operating interest in terminals to ship gas to India at less than $10," said a banker directly involved with the discussions, adding one such deal could be finalized before year-end, Times of India said in a report.

Currently, seven LNG terminals are planned in the US to export gas. Indian companies want to ship from the US east coast just as Chinese counterparts focus on the west coast for shipment to ensure energy security. 

The newspaper report said that shipments from US could become more viable than gas flowing through the Trans-Afghanistan-Pakistan-India (TAPI) pipeline from Turkmenistan in the future. The landing cost of this is estimated at $13 per mmBtu, besides the geopolitical risks. 

The seven planned LNG terminals will allow exports to nations that have signed free-trade agreements (FTAs) with the US. With India not on this list, GAIL India chairman B C Tripathi has sought diplomatic intervention to push Washington to allow these terminals to sell gas to India. 

Union minister of state for petroleum R P N Singh said in Parliament that the external affairs ministry has been asked to intervene for allowing gas imports from US, TOI said.