"GAIL Secures Long-Term LNG Supply Agreement with Vitol"

In a significant development, state-run GAIL (India) announced signing of a long-term liquefied natural gas (LNG) contract with Vitol Asia Pte. The agreement entails the supply of approximately one million tonnes per annum over a span of 10 years, set to commence in 2026.

Under the terms of the deal, Vitol will deliver LNG from its extensive global LNG portfolio to GAIL in India on a pan-India basis, as confirmed by the country’s largest gas utility.

Commenting on the strategic agreement, GAIL CMD Sandeep Kumar Gupta stated, “This long-term LNG deal with Vitol by GAIL will augment its large LNG portfolio and will contribute to bridging India’s demand and supply gap of natural gas.” The move aligns with GAIL's commitment to expanding its presence in the natural gas sector.

GAIL, a public sector undertaking that owns and operates a network of over 16,000 km of natural gas pipelines nationwide, is concurrently engaged in executing multiple pipeline projects aimed at further enhancing its reach.

Vitol CEO Russell Hardy expressed satisfaction with the collaboration, stating, “We are pleased to build on the existing relationship between Vitol and GAIL and to conclude this long-term LNG supply deal together. India is a significant and growing LNG market, and we are excited to bring LNG supply from our global LNG portfolio to meet this rising natural gas demand in India.”

GAIL currently commands a substantial market share of around 70% in gas transmission and boasts a gas trading share of over 50% in India. Additionally, the company and its subsidiaries/Joint Ventures hold a formidable position in City Gas Distribution (CGD).

GAIL's Director (Marketing), Sanjay Kumar, highlighted the rationale behind the deal, stating, "The company is doing this deal as demand for natural gas in India is getting consolidated, and this LNG tie-up is part of the multiple negotiations that GAIL has been carrying on with various LNG suppliers for long-term deals."

Vitol, a global energy trader, trades 7.4 million barrels per day of crude oil and products, and charters approximately 6,000 sea voyages annually. The company's global LNG portfolio includes long-term LNG supply from North America, Africa, the Middle East, and Asia. In 2022, Vitol physically delivered around 14 million tonnes per annum (MTPA) of LNG, showcasing its robust presence in the LNG market.

HBL