ADNOC to supply gas to Indian Oil

livemint.com:

Mint had reported that Indian Oil is in talks with ADNOC for long term contracts of LNG supplies. In another development, IndianOil and TotalEnergies Gas and Power Ltd are set to execute a HoA to establish a long term LNG sale and purchase agreement (SPA). Under this long-term contract valid for 10 years starting 2026, TotalEnergies would supply annually upto 0.8 MMT LNG to IndianOil.

This would be the first Long Term LNG contract for TotalEnergies in India. Queries sent to IndianOil, ADNOC and Total Energies remained unanswered till press time. Indian companies have been looking at securing diversifying their import sources and securing long term deals over the past one year as the Russia-Ukraine war brought about volatility in the global energy market.

The efforts to diversify import sources gained momentum after Gazprom defaulted in its supplies to state-run GAIL under a long term contract for around a year since May last year as spot LNG sales fetched better prices. Gazprom Marketing and Trading Singapore (GMTS), earlier a subsidiary of Russian gas giant Gazprom, had agreed to supply GAIL (India) Ltd 2.5 million tonnes of LNG every year for 20 years starting 2018-19. The supply began in June 2018 but remained disrupted for a year after the Russian invasion of Ukraine.

This forced the Indian state-run company to buy expensive spot cargoes, prompting the government to look for newer LNG sources. India’s natural gas consumption has been on rising, with the Centre’s focus on developing a gas-based economy, with the country consuming 163.06 million metric standard cubic metres per day (mmscmd) in FY 2021-22. Gas comprises about 6.2% of India’s primary energy mix, far behind the global average of 24%.