Speaking on the occasion, Shri Dharmendra Pradhan said that the government was working towards making India a gas based economy. He added that the arrival of the first LNG cargo from US was a significant milestone in the direction of realising adequate availability of natural gas through imports from diversified sources. He further stated that a shift towards a gas based economy would require augmenting domestic production as well as imports. He added that adequate investments in natural gas infrastructure including pipeline, LNG import terminal and City Gas Distribution network was also a focus area for the Government.
The USA has abundant supply of shale gas and the long term LNG contracts signed by Indian companies with US provide India with an access to secure supply source at stable prices which will result in geographical diversification and energy security.
GAIL will have an optimum portfolio mix of LNG indexed to Henry Hub (HH) and crude oil and the customers will benefit from such a unique price blend. GAIL is one of the early movers to contract US LNG and has 5.8 MMTPA of US LNG in its portfolio. GAIL shall be receiving around 90 cargoes per annum from Sabine Pass and Cove Point LNG terminals.
The arrival of this LNG vessel comes close on the heels of formation of Konkan LNG Private Limited, a subsidiary of GAIL, which has recently been demerged from RGPPL.
Total bilateral trade (goods and services) between India and US increased at a CAGR of 11.4% from $20 billion in the year 2000 to over $126.1 billion in the year 2017. India’s trade with USA is expected to increase owing to large scale imports of LNG and crude oil in coming years. GAIL alone would be procuring approx. $ 2 billion worth of LNG per annum from USA from FY 2018-19.