Qatar Holds Firm on Indian LNG Price: Press

Qatar has rejected India's request for a lower LNG price, the energy minister Saad Sherida al-Kaabi told reporters January 27, Indian media reported.

Before a meeting with his Indian counterpart in New Dehli, state Qatar news agency reported that Kaabi would work towards enhancing energy relations but India's oil minister Dharmendra Pradhan said that his focus would be on lowering the LNG price.

The two sides revised the pricing in 2015, cutting prices by half; and India committed to increase its offtake by 1mn mt so that it would buy 8.5mn mt/yr, linked to the crude oil price. However, the current Qatari LNG price for India is reportedly at $8.5-9/mn Btu, almost double the spot price. India would like to pay Qatar around $5/1mn Btu, based on independent price formula. Spot deliveries though come with less flexibility than term contracts and are not therefore directly comparable.

Consultancy Kpler told NGW that India LNG imports reached 24mn mt in 2019, an increase of 1.3mn mt year-on-year, but Qatar-sourced imports dropped this year and were replaced by cheaper shipments from elsewhere, including the UAE: Adnoc has set up new offtake agreements with several trading houses that won DES-based tenders in 2019. India has also received an increasing amount of LNG from Angola – as well as the US, following new plant start-ups there. Indian importer Gail has a long-term offtake agreement with Dominion's Cove Point terminal.