GAIL (India) Limited has entered into a long-term Liquefied Natural Gas (LNG) Sales and Purchase Agreement (SPA) with Vitol Asia Pte. Ltd., as announced by the company on Tuesday.
The agreement follows a binding term sheet signed between the two companies in January 2024. Under the terms of the deal, GAIL will receive around 1 million metric tonnes per annum (MMTPA) of LNG over a period of approximately 10 years, beginning in 2026. The supply will be sourced from Vitol’s global LNG portfolio.
Sanjay Kumar, Director (Marketing) at GAIL, commented on the development, saying, “GAIL is expanding its long-term LNG portfolio to meet growing demand. We are pleased to partner with Vitol Asia Pte. Ltd., and this agreement marks an important step in strengthening our ability to serve our diverse and evolving customer base reliably.”
India, now the world’s fourth-largest LNG importer, is witnessing a steady rise in natural gas demand. To meet this growing need, the Government of India has set a target to increase the share of natural gas in the country’s primary energy mix from the current 6% to 15% by 2030. Reflecting this push, India’s LNG regasification capacity has nearly doubled since 2014, when it stood at 21 MMTPA.
Jay Ng, Chief Financial Officer of Vitol Asia and a member of its Executive Committee, noted, “Vitol is honoured to strengthen its relationship with GAIL through this long-term LNG supply contract. India’s growing energy market is central to our strategy, and our diversified global portfolio enables us to provide a reliable and competitive supply of cleaner energy.”
GAIL, a Maharatna Central Public Sector Enterprise, is India’s leading company in natural gas transmission and distribution. Its operations span an extensive pipeline network, gas processing and petrochemical facilities, upstream interests, and LNG regasification terminals across the country.
Vitol, a global energy and commodities trading firm, has a significant presence in energy infrastructure, with over $13 billion invested in long-term assets worldwide.
