Petronet LNG to sign U.S. gas deal

10 February 2020

Petronet LNG and U.S. liquefied natural gas (LNG) developer Tellurian Inc are preparing to sign a USD 2.5bn deal during President Donald Trump's maiden visit to New Delhi, two sources familiar with the matter said.

India and the United States have built close political and security ties and want to strengthen trade links, with Trump aiming to boost energy supplies to India, the world's third biggest oil importer.

Petronet will invest the money over a five-year period in Tellurian's proposed USD 27.5bn Driftwood LNG export project in Louisiana and the deal will give Petronet an equity stake in the project and rights for up to 5 million tonnes a year of LNG, the sources said.

"Supplies will begin from 2024 and will be gradually raised to 5 million tonnes a year in 2028," one of the sources said.

The delivered price of gas to India would be below $6 per million British thermal units (mmBtu), the source added. This will work out to about 30% cheaper than the country's current long-term deals with Qatar.

"India will be getting the producer-based prices unlike other deals where Indian companies are only one of the customers," the source said, declining to be named.

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