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NorthAmOil                                   INVESTMENT                                          NorthAmOil


       India’s GAIL may buy stake in US LNG facility





        US-INDIA         GAIL (India), the Asian country’s largest gas dis-  sanctions were imposed on Moscow. In 2012,
                         tributor, is considering whether to buy an equity  GAIL signed a 20-year contract with Gazprom
                         stake of up to 26% in a US-based LNG project.  Marketing and Trading Singapore for purchases
                         This is according to a document on GAIL’s  of 2.5mn tpy of LNG on average.
                         website.                               GAIL saw its quarterly profit fall by almost
                           The company is considering buying into a  93% in the fourth quarter of 2022 because of
                         plant that is either already operating or due to  lower gas sales caused by supply disruptions.
                         enter service by 2027.                 State-owned GAIL has said it is currently
                           GAIL or its affiliates are also interested in  negotiating with Abu Dhabi National Oil Co.
                         sourcing 1mn tonnes per year (tpy) of LNG from  (ADNOC) and other companies for LNG.
                         the plant on a free-on-board (FOB) basis over   “Probably we will get a better deal,” GAIL’s
                         a15-year period, according to the document.  head of finance, Rakesh Kumar Jain, told analysts
                         The supplies are expected to begin in the fourth  in late January.
                         quarter of 2026. The LNG supply contract period   Jain also said that in 2023 GAIL would divert
                         could then be extended by 5-10 years, said GAIL.  eight extra cargoes of LNG from the global mar-
                           The Indian company has set March 10 as the  ket and bring them to India instead. “We get 90
                         deadline for potential bids for LNG supply. It  cargoes from the USA and we intend to bring all
                         already has long-term supply contracts with two  of them to India,” he said.
                         US-based LNG export plants.            India is seeking to boost its import capacity for
                           GAIL is seeking to sign more long-term gas  LNG so that the share of natural gas in the coun-
                         import agreements because of disrupted gas sup-  try’s total energy mix rises to 15% by 2030, up from
                         plies after a unit of Russia’s Gazprom was unable  the current 6%, Indian Prime Minster Narendra
                         to deliver LNG to the company after Western  Modi said at a press conference in January.™





                                                   PERFORMANCE


       Tellurian reports fourfold




       increase in gas production




        LOUISIANA        HOUSTON-BASED  LNG developer Tel-    Louisiana. The liquefaction facility has struggled
                         lurian reported on February 22 a fourfold  with delays but Tellurian’s CEO, Octavio Simoes,
                         increase in quarterly natural gas production.  told Reuters that it was now scheduled to deliver
                         This comes after demand soared following  its first LNG in 2026. The company has already
                         Western sanctions against Russia for its inva-  invested $1bn in the liquefaction terminal.
                         sion of Ukraine.                       The company has contracted Bechtel Energy
                           The company increased its gas production to  for the construction of the facility. However, the
                         around 225mn cubic feet (6.37mn cubic metres)  project has hit roadblocks after announcing the
                         per day in the fourth quarter compared with 55  termination of three sale and purchase agree-
                         mmcf (1.56 mcm) per day in the previous year.  ments (SPAs) in September 2022. The deals had
                         As a result, its adjusted core earnings rose to  been signed in the summer of 2021 and included
                         $80mn, compared with $13.3mn in 2021. It was  two with Shell LNG for a total of 3mn tonnes per
                         a strong quarter across the industry, with US gas  year and one with commodities trader Vitol for
                         prices rising 18% year on year on average.  3mn tpy.
                           Tellurian ended the fourth quarter with   In February, Simoes revealed that the
                         $474.2mn of cash and cash equivalents after pro-  company was holding discussions with the
                         ducing 47.3bn cubic feet (1.34bn cubic metres)  Indian government and oil companies over
                         of natural gas during the year across its gas assets,  investing in the Driftwood terminal. India is
                         which include 27,689 net acres (112 square km),  in the midst of switching from coal to gas and
                         143 production wells and estimated proven  expanding gas distribution networks in cities.
                         reserves of 445 bcf (12.6 bcm).      This marks a revival of talks with India after
                           Construction also began in the fourth quar-  a preliminary agreement with Petronet LNG
                         ter on Tellurian’s Driftwood LNG terminal in  expired in 2020.™



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