This document provides an overview of India's liquefied natural gas (LNG) industry, including details on LNG imports, prices, and contracts. It notes that LNG is transported by sea after gas is cooled to liquid form at -160.5°C, occupying just 1/600 of its gaseous volume. India is the fourth largest LNG importer globally and had LNG import terminals located at Dahej, Hazira, Dabhol and Kochi. LNG imports to India have been gradually increasing over time along with growth in regasification capacity.

1. LNG In IndiaLiquefied Natural Gas
Industry Information Insights 2014

2. Table of Contents
Introduction
LNG Value Chain
Global LNG Scenario
LNG Terminals
LNG Imports
Prices of LNG
LNG Contracts

3. Introduction
NaturalGasconsistsmainlyofmethaneandsmallamountsofethane,propaneandbutane.Itistransportedthroughpipelinesbutisextremelybulky.Ahigh-pressuregaspipelinecantransportinadayonlyaboutone-fifthoftheenergythatcanbetransportedthroughanoilpipeline.
LiquefiedNaturalGas(LNG)isaresponsetotheinefficiencyofnaturalgaspipelinesandthetechnicalandeconomicproblemsofrunningpipelinesoverlongdistances.
Ifnaturalgasiscooledatminus160.5°Catatmosphericpressure,itbecomesliquidandmorecompact,occupyingjust1/600thofthegaseousvolume.Thisisbecausemostoftheheavierhydrocarbonsareremovedduringliquefaction.
Thecargothatistransportedinbulkbyseaispredominantlymethane(over80%).Methaneisacolorless,odorless,andtransparentliquidwhichisnon-toxic,non-corrosiveandlessdensethanwater.

4. LNG Value Chain
TheLNGvaluechainconsistsofexplorationandproductionfromthegasfield,liquefaction, shipping,re-gasificationandstorage.

5. Global LNG Scenario
InspiteofgrowinginterestinLNGacrosstheworld,in2012,LNGtradedeclinedmarginallyduetosupply-sideproblems.ThedemandforLNG,however,remainedstrong,especiallyinlightofthenuclearshutdowninJapanandtheresultingincreaseddemandforLNGbybuyerstobridgethepower-generationdeficit.During2012,thetotalglobalLNGtradewas236MMTPA.
Global LNG Suppliers
QataristhelargestLNGproducerintheworld.Malaysia,Nigeria,YemenandAustraliaareotherLNGsuppliers.
PlutoprojectinWesternAustraliawastheonlyLNGprojectcommissionedin2012.ItstartedLNGsuppliesinMay2012.

6. Global LNG Demand
LNGdemandinAsiaincreasedto170milliontonnesin2012,13milliontonneshigherthan2011.ThiswaslargelydrivenbyJapan,whichreceivedrecordimportsof87milliontonnes. LNGimportedbyJapanisusedtobridgethepowerdeficitcausedbythenuclearshutdownduetosafetyconcernsaftertheMarch2011earthquake.
India is the fourth largest LNG importer in the world.

7. LNG Terminals
FourRe-gasificationLiquefiedNaturalGas(R-LNG)terminalsexistinIndia,locatedatDahej, Gujarat(ofPLL),Hazira,Gujarat(ofHaziraLNGPvt.Ltd)andDabhol,Maharashtra(ofGAIL(India)Ltd)andKochi,Kerela(ofPLL).
DecisiontosetupR-LNGterminalsistakenbycompaniesbasedontechno-commercialconsiderations.ManyotherR-LNGprojects,bothontheWestandtheEastcoast,areatconceptualstage.
TheregasificationcapacityofexistingDahejterminalisproposedtobeincreasedfrompresent10MillionTonesPerAnnum(MMTPA)to15MMTPAby2015-16andthatofHaziraLNGPvt.Ltd.(HLPL)from3.6MMPTAto5MMTPAby2015-16.

8. LNG Terminals in India
GAILisalsoplanningtosetupFloatingStorageandRegasificationUnit(FSRU)ontheEastCoastofIndiaatKakinadainAndhraPradesh.IndianOilCorporationLtd.(IOCL)isintheprocessofsettingupof5MMTPALNGterminalatEnnorewhichisscheduledtobecommissionedby2015-16.
LNG Terminal
Stakeholder
Capacity (MTPA)
Dahej
Petronet LNG
10.0
Kochi
Petronet LNG
5.0
Hazira
Shell
3.6
Dabhol
Ratnagiri Gas & Power
1.2

9. DahejLNG Terminal
DahejLNGTerminalisSouthEastAsia'sfirstLNGReceivingandRegasificationTerminalwithanoriginalnameplatecapacityof5MMTPAatDahej,Gujarat.
Theinfrastructurewasdevelopedintheshortestpossibletimeandatabenchmarkcost.Thecapacityoftheterminalhasbeenexpandedto10MMTPAandthesamehasbeencommissionedinJune,2009.
TheexpansioninvolvedconstructionoftwoadditionalLNGstoragetanksandothervaporizationfacilities.
PLLhasalsoinitiatedtheprocessforsetting-upasecondLNGJettyatDahej.ThesecondLNGJettyisrequiredforriskmitigationaswellastoberththehighercapacityQ-MaxandQ- FlexLNGvessels.

10. HaziraLNG Terminal
HaziraisapartnershipbetweenShellGasB.VandTotalGazElectricitéHoldingsFrance. BoththeShareholdersrepresenttwoofthelargestprivateLNGsuppliersintheworld.ShellandTotalhaveashareholdingof74%and26%respectivelyineachofthecompaniesthatcomprisetheHaziraLNGTerminalandPortprojectandarecollectivelyknownasHaziraGroupCompanies(HGC).
HaziraLNGterminalwascommissionedon16April,2005.ItisIndia’sfirstLNGterminalbyaglobalenergycompany.
TheterminalhasajettywhereLNGcargoisunloadedthroughtothecryogenictanks.LNGisstoredinthetanksat-160°Candpumpedoutofthetankforsendingouttocustomersafterregasification.
A12.5Km,28inchpipelinetransportshighpressuregastotheHaziraMoraMeteringStation.ItisinterconnectedtoGAIL,GSPLandRGTILpipelinesatMora.

11. LNG Imports
LiquefiedNaturalGas(LNG)isimportedintoIndiaundertermcontractsandonspot/shorttermbasisfromQatar,Nigeria,Algeria,Spain,Egypt,France,Yemen,Brunei,AbuDhabi, Oman,EquatorialGuinea,Norway,Trinidad&Tobago,USA,Australia,Malaysia.
ImportofLNGinIndiastartedin2003-04aftersettingupofDahejLNGTerminal.Withincreaseinregasificationterminals,LNGimportinIndiaisgraduallyincreasing.
0.247
2.499
5.060
6.811
8.249
7.958
8.922
9.730
11.632
10.901
10.760
0
2
4
6
8
10
12
14
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
MT
LNG Imports

12. Prices of LNG
ThepriceofLNGimportedunderthetermcontractsisgovernedbytheSale&PurchaseAgreement(SPA)betweentheLNGsellerandbuyer.Spotcargoesarepurchasedonmutuallyagreeablecommercialterms.
ThelongtermLNGpricesinAsiapacificmarketarelinkedtoJapaneseCrudeCocktail(JCC) asJapanisthelargestandoldestimporterofLNGintheworld.
TheJapanCustoms-clearedCrude(JCC)istheaveragepriceofcustoms-clearedcrudeoilimportsintoJapan.
TheaverageimportpriceofLiquefiedNaturalGas(LNG)importedrangesbetweenUS$ 8.75/MMBTUtoUS$16.50/MMBTU.

13. LNG Contracts
GAIL
GAILhassignedalong-termcontractwithSabinePassLiquefactionLLC,USforimportof3.5MMTPAofLNGfor20yearswhichmayalsoincludeshalegasonFoBbasisfrom2018-19.
GAILhasenteredintomediumtermcontractwithMarubenifor0.25MMTPAofLNGquantities,andsupplieshavealreadycommenced.
PLL
PLLhassourced7.5MMTPAhroughLongTermContractwithRasGas,QatarwithbacktobacksalesarrangementwithGAIL,IOCL&BPCL.
PLLhasenteredintoa20yearcontractwithMobilAustraliaResourcesCompanyPty.Ltd. fromitsGorgonprojectinAustraliaforsupplyof1.44MMTPAofnaturalgas,tocommencefrom2014.

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