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India looks for 'right prices'

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LNG Industry,

Reuters are reporting that India may increase imports of LNG from the US at the right price, even though some Indian buyers are trying to get rid of costly US supplies.

India's GAIL Ltd signed a swap deal with trader Gunvor to sell some of its US LNG as the company attempts to cut costs for price-sensitive customers after a sharp fall in Asian spot prices made its US gas unattractive.

GAIL has contracted for most of the capacity from one of Sabine Pass' liquefaction trains in the US Gulf Coast, with deliveries expected to start in late 2017.

However, supplies of LNG and even crude from the US might increasingly flow to India at the right prices.

GAIL in 2011 signed a 20-year sales agreement with Sabine Pass Liquefaction LLC, a unit of Cheniere Energy Inc, for the supply of 3.5 million tpy.

Under the recent agreement between GAIL and Gunvor, the trading firm will supply 15 cargoes or about 800 000 t of LNG for India's west coast from April through December, while GAIL will sell about 600 000 t in 2018 from Sabine Pass at a premium to its pricing formula.

India's current booking capacity for LNG is around 6 million tpy.

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