In the case of PLL, the additional demand, amounting to one million tonnes (MT), over and above the 2.5 MT which the company has already booked from Qatar, surprisingly comes from power and fertiliser companies. For the first year, PLL had contracted to sell gas to non-fertiliser and non-power based companies, when ideally it should have been the other way round.
While companies such as PLL may have got the first movers advantage on the LNG front in India, one does not know whether the spot market would offer a good price. It can be low, but it can be high as well. The former would be great news but if it is the latter, it is the power and fertiliser companies which would stand to lose.
More importantly, if power and fertiliser companies still go ahead and buy this LNG (for instance, due to domestic shortfall), it is the final consumer that would have to take the hit. This spot buy could well be a one-off case. This is not to suggest that spot buying should be avoided, but rather that spot buying should be limited to small users of gas. But for that, proper planning and estimates for gas are of paramount importance. At present, despite being energy deficient, India is not seen as a big gas market.
Unlike countries such as Japan and China, we cannot dictate the gas market and for a long time will continue to be price takers. At least a well thought-out strategy would enable us to carve out a niche in the international gas market.