India's Gail to Get Gazprom LNG from May

India’s Gail is likely to begin receiving LNG from Gazprom under the new revised deal by May this year, Indian oil minister Dharmendra Pradhan said April 4 in Rajya Sabha, the upper house of parliament. 

In January 2018, Gail and Gazprom said they had re-negotiated and amended their long-term LNG sale and purchase agreement (SPA), originally signed in the year 2012.

“Due to the change in market conditions, Gail took up with Gazprom Marketing & Trading Singapore for review of LNG price under the SPA. After detailed discussions, both parties agreed on an understanding for amendment to the LNG SPA through a Deed of Amendment primarily on volume ramp up and reduction in price, which has been signed on January 16 2018 with commencement of LNG supplies agreed to be from May 2018,” the minister said.

“Due to the gradual ramp-up, supplies are likely to reach full contracted LNG volume in five to six years,” he added.

The minister did not disclose the details of the renegotiated deal but media reports in January said that pricing has been changed from nine-month linkage to JCC (Japanese customs-cleared crude oil) to a three-month average of Brent crude oil, and that Gail is expected to be allowed to build up to the full 2.5mn mt/yr level during the first three years, but in return the full term of the deal has been extended by two to three years.