Gas demand in India is set to grow as the country seeks to increase the share of clean fuels in its energy mix to 15% by 2030 from the current 6%.
see photosPetronet and Qatar Gas need to negotiate extension of their current deal until the end of 2023
India’s top gas importer Petronet LNG will seek higher volumes at better prices from Qatar Gas during talks to extend its long-term liquefied natural gas (LNG) deal beyond 2028, its finance chief said. Petronet and Qatar Gas are required to negotiate an extension of their current deal for 7.5 million tonnes per annum (MTPA) of LNG by the end of 2023. “We are trying to extend the contract beyond 2028, we are making all efforts to renegotiate and maybe extend that contract,” said Vinod Kumar Mishra, an analyst after Petronet announced quarterly earnings. Told the call
He said any extension of the deal would be based on the recently signed contracts by Qatar Gas with China, Bangladesh and Pakistan, where gas prices are tied to a slope of around 10.2% of Brent crude price on an ex-ship basis . In contrast, India’s LNG deal with Qatar is based on a slope of around 12.7% of the three-month average Brent price.
India’s LNG deal with Qatar is based on a slope of around 12.7% of the three-month average Brent price.
Gas demand in India is set to grow as the country seeks to increase the share of clean fuels in its energy mix to 15% by 2030 from the current 6%.
Mishra said buying gas under long-term contracts is the best bet in the current scenario. Gas under such deals costs Petronet about $10.2 per million British thermal units (mmBtu), compared to spot prices of about $30/mmBtu.
“If you need gas on a regular basis, then on a permanent basis you cannot rely on spot or short term cargo.
Earlier in the day Petronet chief executive AK Singh said the power sector has reduced gas usage due to higher prices and its Dahej LNG plant operated at lower capacity during the September quarter.
He also said Petronet would consider investing in liquefaction facilities and upstream gas projects if the deals made commercial sense.
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