GAIL eyes stake in Russia’s planned 10-mt LNG plant | business | Hindustan Times
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GAIL eyes stake in Russia’s planned 10-mt LNG plant

business Updated: Aug 15, 2012 21:15 IST
GAIL India Ltd

State-owned GAIL India Ltd is interested in buying stake in Russia’s planned 10-million tonnes (mt) LNG plant and import natural gas from the $7-billion project to meet India’s growing energy needs.

Russia’s gas monopoly Gazprom plans to start output of liquefied natural gas at the planned project near the Russian far eastern city of Vladivostok in 2016 or 2017. The company plans to build a pipeline from the Chayanda gas field in East Siberia to the proposed Vladivostok LNG facility.

GAIL’s interest in the LNG terminal was flagged during the two-day visit of Russian deputy prime minister Dmitry Rogozin last month, sources privy to the development said.

Gazprom is switching focus to LNG exports from its Far East Russian fields to South-East Asian markets. It sees growing demand from traditional gas markets such as South Korea and Japan, but also emerging giants China and India.

Sources said Gazprom’s marketing and trading unit last year signed agreement with the Indian firms to sell LNG on long-term contracts.

Gazprom Marketing & Trading Singapore signed preliminary agreements to sell as much as 7.5 million tonnes of LNG per year to Petronet LNG, GAIL and Gujarat State Petroleum Corp.

Sources said GAIL sees synergy in these agreements and its desire to have stake in LNG producing plant in Russia.

In return for a stake, GAIL is even willing to commit to lift up to half of the 10 million tonnes a year of LNG the Vladivostok plant will produce, they said.