India's Gail pens 10-year LNG deal with Vitol

Indian state-owned gas company Gail has signed a 10-year deal to buy 1mn tonnes/year of LNG from commodity trader Vitol, it said on January 5. 

Under the terms of the deal, Vitol will begin supplies in 2026 and draw from its global LNG portfolio to deliver LNG to Gail India on a pan-India basis. The agreement aims to play a crucial role in bridging India's demand and supply gap for natural gas.

"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,” Sandeep Kumar Gupta, managing director, Gail said. 

Gail currently holds a portfolio of about 14mn tonnes/year of LNG from various long and short-term contracts. In addition to its main supplier, Qatar, Gail also has long-term contracts with Gazprom and ExxonMobil (Gorgon LNG). The company also has two US LNG contracts: one is with Cheniere and one with Dominion. Both are indexed to the most liquid US gas hub, the Henry Hub.  

Vitol CEO, Russell Hardy said, "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, with its extensive network of over 16,000 km of natural gas pipelines, commands a significant market share in gas transmission and holds a gas trading share of over 50% in India. Additionally, Gail is actively engaged in the city gas distribution sector.

Vitol boasts a global LNG portfolio with long-term LNG supply sources spanning North America, Africa, the Middle East, and Asia, further supported by a global fleet of LNG vessels.