Page 5 - AsiaElec Week 24
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AsiaElec COMMENTARY AsiaElec
Tellurian and Petronet had envisioned final-
ising the transaction by March 31, but after for additional new contacts and volumes to com-
executives from the US company visited India ply with requirements from India.”
in February the deadline was pushed back to Doha’s bargain position may have weakened
May 31. Tellurian spokesperson Joi Lecznar said enough that New Delhi may be willing to try
last week that while the agreement had lapsed, again. Qatari gas cost an estimated $8.5-9 per
the company was still in talks with Petronet and mmBtu ($235.11-248.94 per 1,000 cubic metres)
other possible offtakers for the LNG terminal. when oil was $60-70 per barrel. The average spot
The lapsing of the deal is anticipated to delay price for July delivery into East Asia, meanwhile,
an FID on the export project, given that Tellu- was estimated at $2.10 per mmBtu ($58.09 per
rian has only managed to finalise one supply 1,000 cubic metres) on June 5.
deal – Total agreed in July 2019 to buy 1mn tpy The IEA has said India and China’s expand-
as well as a $500mn investment in Driftwood ing gas consumption will help support a recov-
Holdings. ery in global demand in the coming years. India
The Driftwood project includes gas produc- is expected to close in on South Korea’s position
tion, gathering, processing and transportation as the world’s third-largest importer of LNG by
facilities, along with the 27.6mn tpy Driftwood 2023, while China will overtake Japan as the
LNG export facility that will be located near global leader.
Lake Charles, Louisiana. Singh told Platts that while the South Asian
giant’s gas demand had fallen from a pre-
What next COVID-19 high of 160mn cubic metres per day
India has a history of seeking better supply deals to 110 mcm during the lockdown, it had already
while the energy market is experiencing price recovered to 145 mcm per day and it would not
pains. New Delhi managed to convince the be long before the lost ground had been regained.
Qatari government in 2015 to halve the cost of He added that LNG imports, which shrank 40%
its long-term gas supplies. In exchange, India to 1.5mn tonnes in May, would pick up over the
agreed to raise its purchases from 7.5mn tpy to next six months.
8.5mn tpy. India then moved on to a successful Given that Qatar is embarking on a major
renegotiation of long-term supply contracts with expansion of its LNG export capacity and the
Australia and Russia. demand outlook is plagued by uncertainty – the
New Delhi tried in January to revisit its sup- biggest threat remains a second wave of COVID-
ply deal with Qatar once more, but its efforts fell 19 infections – it would not be surprising to hear
flat, with Energy Minister Saad Sherida al-Kaabi in the coming months that Indian buyers had
saying: “We are not renegotiating contracts, we indeed managed to secure more favourable term
stick with contracts – both sides – and we look contracts.
Week 24 17•June•2020 www. NEWSBASE .com P5
