India seeks barter deal to buy Qatar LNG
Oil Minister Asks Qatar to Acquire stakes in domestic power plants as part of Future deals.
New Delhi: India on Tuesday said it would sign future long-term liquefied natural gas (LNG) purchase deals with Qatar if only Doha agrees to acquire stakes in the South Asian nation’s power plants, oil minister Dharmendra Pradhan said.
India is the latest major LNG buyer to seek concessions from Qatar, the world's biggest LNG exporter, in order to re-sign long-term supply contracts. Amid a global glut of LNG and a slump in prices, other buyers have sought more flexible contracts, including clauses that would allow them to resell gas they do not consume.
"Yesterday, we have given a firm proposal to Qatar. If they want to have a long-term off-take assurance, there is a window. They can deal with our stranded power plants, from end to end they can give some solution,” Mr Pradhan told Reuters on Tuesday.
India is suffering from natural gas shortages that have required power plants with capacity of as much as 25,000 megawatts to shut down or run as lower rates. Qatar's RasGas is India's biggest LNG supplier.
“It won’t be quid pro quo but mutual interest... They can share the profit of those power plants,” said Mr Pradhan, adding New Delhi wants to expand its ties with Doha beyond simply buyer and supplier.
India wants to gradually move to a gas-based economy and has plans to raise its annual LNG import capacity to 50 million tonnes in the next few years from 21 million tonnes now.
India is also open to granting stakes to Qatar in local oil and gas companies and LNG terminals, should the Gulf emirate make such a proposal, said Mr Pradhan.
India’s biggest gas importer Petronet LNG annually buys 8.5 million tonnes under a long-term contract. It also buys additional volumes from Qatar under spot deals.
Prabhat Singh, chief executive of Petronet, said the Gulf nation needed to decide quickly on the Indian proposal. He said India could be a stable outlet for Qatar’s LNG.