India’s largest gas utility GAIL has signed a long-term deal to buy liquefied natural gas (LNG) from energy trader Vitol.
Under the deal, Vitol Asia will deliver 1 million metric tons of LNG to GAIL for a period of about 10 years starting in 2026, according to a statement by GAIL.
GAIL said that Vitol would deliver the LNG supplies from its global portfolio on a pan-India basis.
The state-owned firm said this deal “will contribute to bridging India’s demand and supply gap of natural gas.”
GAIL signed this deal as “demand for natural gas in India is getting consolidated and this LNG tie up is part of the multiple negotiations which GAIL has been carrying on with various LNG suppliers for long-term deals,” it said.
The company owns and operates a network of over 16,000 km of natural gas pipelines in India.
GAIL holds a stake in India’s largest LNG importer, Petronet LNG, and buys volumes under long-term LNG deals, including from Qatar and the US.
It also charters LNG carriers and operates the 5 mtpa Dabhol LNG terminal in India.
On the other hand, Vitol has a global LNG portfolio with long-term LNG supply from North America, Africa, Middle East, and Asia, and charters a fleet of LNG carriers.
In 2022, Vitol physically delivered about 14 mtpa of LNG, according to the statement.