GAIL-Gazprom LNG Deal

A former unit of Russian energy giant Gazprom has rejected state-owned GAIL (India) Ltd's demand for compensation for non-delivery of LNG supplies in the aftermath of Russia's invasion of Ukraine. In a stock exchange filing, GAIL said SEFE Marketing Trading Singapore Pte Ltd has stated that it does not owe anything other than the defaulted cargoes. GAIL in December last year filed an arbitration claim before the London Court of International Arbitration seeking USD 1.8 billion for "non-supply of LNG cargoes under a long-term contract.. This included compensation for non-supply besides making up for the defaulted volumes. GAIL in 2012 signed a 20-year deal to buy as much as 2.85 million tonnes per annum of liquefied natural gas (LNG) with Russian energy giant Gazprom. The deal was signed with Gazprom Marketing and Singapore (GMTS), which at the time was a unit of Gazprom Germania, now called Sefe. The Russian parent gave up ownership of Sefe after Western sanctions were imposed on

State-owned Gail India on Friday said it has initiated legal proceedings against a former unit of Russian energy giant Gazprom for non-delivery of LNG and has sought USD 1.817 billion in damages. In a stock exchange filing, the gas utility said it has filed an arbitration claim before the London Court of International Arbitration for "non-supply of LNG cargoes under long-term contract." GAIL in 2012 signed a 20-year deal to buy as much as 2.85 million tonnes per annum of liquefied natural gas (LNG) with Russian energy giant Gazprom. The deal was signed with Gazprom Marketing and Singapore (GMTS), which at the time was a unit of Gazprom Germania, now called Sefe. The Russian parent gave up ownership of Sefe after Western sanctions were imposed on Moscow over its invasion of Ukraine last year. Sefe had stopped supplying LNG to the Indian company in June last year to meet its own demand. GAIL in the filing said it has sued "SEFE Marketing & Trading Singapore Pte Ltd (erstwhile ...

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The centre may neither pursue arbitration with Gazprom, the world's largest natural gas explorer, nor accept a penalty from the company after it halted supplies to GAIL in May

A former Gazprom subsidiary reneges on its supply contract forcing the state-owned gas distributor to cut back supplies to key industries

An industrial consumer said GAIL has restricted its gas quantities to a 'take or pay level', the lowest level at which it will not attract a penalty from the customer

Earlier this month, Moscow slapped sanctions on owner of the Polish part of the Yamal pipeline that carries Russian gas to Europe, as well as the former German unit of the Russian gas producer Gazprom

This comes a few weeks after India's first LNG cargo from the US landed at Dabhol regasification terminal in Maharashtra

The deal signed in 2012 is a 20-year LNG sales and purchase agreement following the signing of an earlier basic framework agreement (BFA) by the two companies in May 2011