First US shale gas reaches India; GAIL's Dabhol terminal receives cargo

GAIL said it would be annually receiving about 90 cargoes of liquefied natural gas from Sabine Pass and Cove Point LNG terminals in the US

India’s first liquefied natural gas (LNG) cargo from America landed at the Dabhol regasification terminal in Maharashtra on Friday. This is part of a $32-billion supply deal for 20 years that GAIL signed with the Dominion Energy Cove Point project in Maryland and Cheniere Energy Inc’s Sabine Pass Project in Louisiana.

India’s trade with America is expected to see large-scale import of LNG and crude oil in the coming years. Total bilateral trade (goods and services) between India and the US increased at a compound annual rate of 11.4 per cent from $20 billion in 2000 to $126.1 billion in 2017. GAIL alone would be procuring around $2 billion worth of LNG per annum from USA from 2018-19.

GAIL’s first charter-hired vessel, MV Meridian Spirit, arrived after a 25-day voyage and docked for unloading in the presence of petroleum minister Dharmendra Pradhan, GAIl chief B C tripathi and US diplomatic officials. Pradhan said a shift towards a gas-based economy would require augmenting domestic production and import. Investment in natural gas infrastructure, including pipelines, LNG import terminals and city gas distribution networks was a focus area.

GAIL’s first Chartered LNG Vessel carrying long-term US LNG arrives at Dabhol

GAIL wan an early mover to contract for LNG from America. It will get around 90 cargoes annually from the Sabine Pass and Cove Point terminals. It had signed a sale and purchase agreement with Cheniere Energy in December 2011; the latter will sell about 3.5 million tonnes of LNG a year to GAIL. 

The arrival of this LNG vessel comes soon after the formation of Konkan LNG, a subsidiary of GAIL.

Asian markets account for about 70 per cent of global LNG shipment; India is one of the fastest-growing importers.