The Gazprom LNG trading office in Singapore has signed a final sales agreement with Gas Authority of India (GAIL) for the Russian company to supply 2.5 million tonnes per annum of LNG over 20 years.
The LNG will come from Gazprom's production facilities on Sakhalin Island in the Russian Far East, supplemented by the global portfolio of the Russian company's marketing arm, Gazprom Marketing & Trading.
Under the contract, the LNG will be priced with an oil-indexed formula and delivered to the Dahej, Dabhol and Kochi import terminals located on the west coast of India.
Chief Executive of GM&T, Vitaly Vasiliev, said: "We are delighted to have signed this agreement with GAIL during a period of rising demand for LNG in India.
"We are looking forward to working together with GAIL to help meet India's expanding gas demand whilst securing a long-term market for Russian gas.
"We recognise GAIL's strength as the major gas player within India, enabling flexible access to a rapidly developing market and are confident that this SPA will further strengthen our already well-established LNG trading relationship," Vasiliev added.
Commenting on the final supply deal, GAIL Chairman B. C. Tripathi said: "This long-term LNG supply agreement with Gazprom, which holds the world's largest gas reserves, is another milestone in Indian-Russian energy cooperation.
"The deal with Gazprom reinforces GAIL's commitment to facilitate the development of the Indian market for which $6 billion in investments are being made by GAIL in creating natural gas infrastructure.
"The deal also marks our efforts to create a well-diversified and secured supply portfolio to meet the ever growing energy requirements of the Indian economy and enable sustainable long-term growth for GAIL," Tripathi added.
