India scores big: GAIL inks 10-year LNG pact with UAE's ADNOC

In a noteworthy development, GAIL India, the state-run gas utility, disclosed on Monday a substantial long-term contract with the Abu Dhabi National Oil Company (ADNOC) for the procurement of liquefied natural gas (LNG). The decade-long agreement, set to commence in 2026, encompasses the acquisition of 0.5 million tonnes per annum (MTPA) of LNG.

This accord materialized from a Memorandum of Understanding (MoU) inked on October 30, 2022, between GAIL and ADNOC P.J.S.C., establishing a collaborative framework for potential cooperation areas. The primary focus outlined in the agreement was the procurement of LNG by GAIL from ADNOC, covering short-term, medium-term, and long-term tenures.

GAIL India, the country's largest gas utility, lauded the agreement as a significant step forward in strengthening cultural and economic ties between India and the United Arab Emirates (UAE).

As per GAIL, deliveries under the agreement are scheduled to commence in 2026, spanning the next 10 years, and will be distributed nationwide in India. The utility envisions that this arrangement will not only meet India's growing energy security needs but will also align with GAIL's strategic objectives in navigating the evolving natural gas landscape in the country.

Sandeep Kumar Gupta, CMD of GAIL, expressed optimism about the long-term LNG deal, emphasizing its crucial role in bridging the demand-supply gap for natural gas in India. He also highlighted the potential for expanding the strategic partnership between GAIL and ADNOC into other domains within the energy sector.

Sanjay Kumar, Director (Marketing) at GAIL, underscored the broader impact of the agreement, noting that it would significantly enhance GAIL's diverse LNG portfolio, catering to a wide consumer profile.

The long-term LNG purchase agreement with ADNOC Gas is anticipated to strengthen India's energy security, foster economic collaboration, and pave the way for new avenues of strategic partnership between GAIL and ADNOC in the energy sector.

News by Rahul Yelligetti