GAIL in talks with Golar LNG for shipping US gas

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New Delhi | Updated: December 30, 2015 9:48 AM

GAIL has also called bids for hiring of nearly 11 ships to ferry LNG.

GAIL-akash660GAIL has also called bids for hiring of nearly 11 ships to ferry LNG. (Photo: Akash Sinha)

GAIL (India) is believed to be in talks with Golar LNG, one of the world’s leading owners and operators of LNG carriers, to ferry gas from the US starting 2017. Separately, the state-run gas marketing and trading firm has also called bids for hiring of nearly 11 ships to ferry LNG. The discussions with Golar is seen as an interim arrangement till the chartered ships are ready, which is expected only by 2019.

Sources told FE that top executives of GAIL and Golar held several round of meetings in New Delhi recently. The executives of Nasdaq-listed Golar have also met senior officials at the petroleum ministry here.

Golar’s fleet consists of 13 vessels till April 2013, while there were plans to add 11 LNG carrier new-builds, said the company website. These new-build carriers will be available to meet a range of charter terms, it said. The company did not respond to queries sought by FE.

When contacted GAIL spokesperson said, “GAIL has floated a tender for time-charter hiring of up to 11 ships for 15 to 18 years through international competitive bidding. Exact number of ships to be chartered will be decided in due course. The tender was floated on September 15, 2015 with a due date of submission of December 14, which has now been extended till February 29, 2016.”

“The successful bidder and final cost will emerge through the competitive bidding process,” the spokesperson added.

The volumes to be shipped by Golar and timelines are not immediately known. GAIL has kept the options of selling the overseas gas in India or overseas. In December 2011, GAIL signed a deal with Cheniere Energy Partners to buy 3.5 mtpa of LNG from the Sabine Pass Terminal in Louisiana on FoB basis. Deliveries would start between March and August 2018. In April 2013, GAIL booked another 2.3 mtpa capacity to export LNG from the Dominion Cover Point terminal in Maryland, delivery of which is expected from end-2017.

According to the tender for chartered ships, the vessels build overseas are to be delivered between January and May 2019 and those made locally are to be ready between July 2022 and June 2023. There would be a gap between starting of supplies from the US and when these vessels would be ready. France-based Gaztransport & Technigaz (GTT) has decided to offer its LNG ship building technology to India. Last week, GTT and   Cochin Shipyard Limited signed an agreement, which would facilitate building vessels under Make in India initiative. Meanwhile, Kochi Shipyard has joined hands with Samsung Shipyard, while Pipavav Shipyard has tied up with Daewoo Shipbuilding to qualify themselves for participating in the GAIL tender.

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