India’s GAIL and Shell ink LNG pact

India’s largest gas utility GAIL and LNG giant Shell are joining forces to collaborate in various fields, including LNG for road transport and regasification.

According to a statement issued on Friday, GAIL has signed a memorandum of understanding with Shell Energy India, a unit of Shell.

GAIL said in the statement this is “a step towards achieving improved sustenance in business operations.”

In a bid towards diversification of the feedstock for its petrochemical plant, GAIL is looking to import ethane from ethane-surplus countries with matured export terminal infrastructure through water borne transportation to India and transport it further through its pipeline systems to demand centers, it said.

The memorandum envisages to explore prospects in import and handling of different hydrocarbons which are important chemical and petrochemical precursors, LNG for road transport, regasification of imported LNG, and renewables, the firm said.

GAIL holds a stake in India’s largest LNG importer, Petronet LNG, and buys volumes under long-term LNG deals from Qatar and the US, as well as from the spot market.

It also operates the 5 mtpa Dabhol LNG terminal in India.

The firm recently launched an expression of interest as it looks to buy a stake in a US liquefaction facility and to receive more US volumes.

On the other hand, Shell sold 65.98 million tonnes of LNG last year, a rise of 3 percent, while its liquefaction volumes reached 29.68 million tonnes.

Shell Energy India operates the 5 mtpa Hazira LNG import facility in Gujarat. Back in January 2021, it launched a truck loading unit at the facility.

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