After ‘cold’ start, India renews $78 billion Qatar gas deal with savings of $6 billion
BETU(Goa): India renews 1999 contract for gas shipping for 20 years Queue Lower rates and more favorable terms would result in an estimated savings of $6 billion over an extended period, according to current estimates brent Crude oil price is $80 per barrel.
India’s largest gas importer Petronet-LNG and QatarEnergy on Tuesday signed an agreement extending the contract expiring in 2028 for the import of 7.5 million tonnes on the sidelines of India Energy Week. lng (Liquefied Natural Gas) for an estimated $78 billion annually.
India fulfills 40% of its gas needs through imports. The contract with QatarEnergy accounts for 35% of total gas imports. Qatar began supplying LNG from 2003–2004 under the current deal, priced at a ‘slope’ (percentage) of 12.67% of current Brent crude futures rates and a fixed fee of 52 cents per unit (million British thermal units or mmBtu). Is. ) of gas.
Sources said that under the revised contract, the fixed charge has been abolished, while the slope remains largely the same. The revised terms will also save on shipping costs as QatarEnergy will bear the cost of delivering the gas to the port specified by Petronet under DES (on delivery basis) as against the FOB (free on board) arrangement in the existing contract, where the buyer arranges shipping. Is. Overall, there will be a saving of $0.8 per unit of gas.
The favorable terms in the renewed contract indicate India’s growing strength as a pivot of global energy demand growth. Indian negotiators took advantage of this fact to drive a hard bargain during protracted talks.
The talks came as bilateral relations deteriorated after a Qatari court sentenced eight former Indian Navy The officials were accused of spying for Israel, in what was seen as an attempt by Doha to influence the talks.
But New Delhi took a tough stance as the talks came at a time when Qatar, the world’s biggest LNG exporter, was looking for buyers for its expanded liquefaction capacity amid surging US supply to Europe, limiting marketing options. Qatar’s liquefaction will increase from 77 million tonnes per year to 126 million tonnes by 2027.
India’s largest gas importer Petronet-LNG and QatarEnergy on Tuesday signed an agreement extending the contract expiring in 2028 for the import of 7.5 million tonnes on the sidelines of India Energy Week. lng (Liquefied Natural Gas) for an estimated $78 billion annually.
India fulfills 40% of its gas needs through imports. The contract with QatarEnergy accounts for 35% of total gas imports. Qatar began supplying LNG from 2003–2004 under the current deal, priced at a ‘slope’ (percentage) of 12.67% of current Brent crude futures rates and a fixed fee of 52 cents per unit (million British thermal units or mmBtu). Is. ) of gas.
Sources said that under the revised contract, the fixed charge has been abolished, while the slope remains largely the same. The revised terms will also save on shipping costs as QatarEnergy will bear the cost of delivering the gas to the port specified by Petronet under DES (on delivery basis) as against the FOB (free on board) arrangement in the existing contract, where the buyer arranges shipping. Is. Overall, there will be a saving of $0.8 per unit of gas.
The favorable terms in the renewed contract indicate India’s growing strength as a pivot of global energy demand growth. Indian negotiators took advantage of this fact to drive a hard bargain during protracted talks.
The talks came as bilateral relations deteriorated after a Qatari court sentenced eight former Indian Navy The officials were accused of spying for Israel, in what was seen as an attempt by Doha to influence the talks.
But New Delhi took a tough stance as the talks came at a time when Qatar, the world’s biggest LNG exporter, was looking for buyers for its expanded liquefaction capacity amid surging US supply to Europe, limiting marketing options. Qatar’s liquefaction will increase from 77 million tonnes per year to 126 million tonnes by 2027.
