Petronet expects India’s LNG imports to rise due to lower prices

Petronet LNG is expecting India’s LNG imports to increase in the first quarter of this year due to lower spot prices.

India’s LNG imports decreased by 11.5 percent in December while the import bill rose by 19 percent when compared to the same month in the year before.

During the April-December period, India took 20.39 bcm of LNG, or some 15 million tonnes, down by 15.1 percent, India’s PPAC said last week.

Spot LNG prices were high last year mostly due to a huge demand from Europe.

However, spot prices have considerably dropped during the last two months due to mild weather in Europe and full storages.

Petronet LNG’s finance director, Vinod Kumar Mishra, said during the company’s quarterly earnings conference call on Friday that high prices of $30-$40 per mmBtu largely affected demand in India but the prices halved in the last period.

“We see that there is less demand in the market, at least in the European market, and because of that the prices are lower,” he said.

“And we hope that this continues in the fourth quarter when more volumes will come, because I am sure that if prices remain at this level, $15 to $20, then certainly spot cargoes will come to India in this quarter,” he said.

Lower volumes, higher profit

Petronet LNG reported lower volumes at the company’s two regasification terminals during the October-December period of last year.

During the quarter, Petronet’s 17.5 mtpa Dahej terminal processed 154 TBTU of LNG. This compares to 196 TBTU in the same quarter last year and 182 TBTU in the previous quarter.

Including the 5 mtpa Kochi facility, the overall LNG volumes reached 167 TBTU. This compares to 208 TBTU last year and 192 TBTU in the previous quarter.

Profit after tax or PAT reached 11.8 billion rupees ($145 million) in the quarter, up from 7.44 billion rupees in the prior quarter and 11.4 billion rupees in the same quarter in the year before.

India’s largest LNG importer reported highest ever profit before tax of 15.8 billion rupees and highest ever turnover of 460 billion rupees due to mostly high prices.

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