State-owned companies — GAIL India Ltd and Shipping Corporation of India (SCI) — are in talks to jointly acquire nine large carriers to ship LNG (imported natural gas) in a deal valued at $3 billion (about Rs18,000 crore).
Under the tie-up currently being negotiated, GAIL will acquire the nine LNG ships, while SCI will run them.
According to SCI director (liner and passenger services) Sarveen Narula, the shipper has the option to pick up stake up to 25% once a joint venture company is formed with GAIL for the acquisition. “We are trying to buy nine LNG ships, not through SCI but through GAIL. SCI will run those ships in partnership with GAIL. We are actively working with GAIL in selection of (other) partners. We may have the right to take up to 25% of the stake in that (venture),” he said.
SCI is currently running four LNG ships through joint venture companies with Japanese partners among others, in which the Indian PSU holds 26% stake.
“The details of the agreement are being finalised. We are already been in talks with them. Very soon it will be done. It is brokered through the government,” Narula added.
SCI currently has an memorandum of understanding with GAIL for transporting LNG from the US to India in 2016-17 wherein it has step-in right up to 26% and also providing technical consultancy.
“That is why we are tying up with GAIL. We will have the technical expertise. The funding will be through GAIL. So this becomes a new business for us. Each ship would cost around $300 to 350 million,” Narula said when asked about the capital requirement for buying the vessels.
(With inputs from agencies)