Petronet LNG in Negotiations with Qatari RasGas

Petronet LNG said it is in talks with RasGas to buy a spot cargo of liquefied natural gas as a production suspension at India’s Panna-Mukta fields has led to a local supply shortfall. “We are working on with RasGas,” Petronet LNG chief executive Ashok Balyan told reporters on the sidelines of an industry conference. “We will be able to finalise (the cargo deal) by the end of the month.”

Balyan had on August 10 said Petronet LNG’s first spot cargo in 2010 will likely reach its terminal in the western state of Gujarat by 20 August 2010, but hadn’t revealed the source of the cargo. Yesterday, he didn’t say why the cargo was delayed. BG India, a unit of BG Group, suspended production of oil and gas at the Panna-Mukta fields off the west coast July 20 due to a leak in an undersea pipeline. The fields produced about 35,000 barrels of oil and 205 Mscf/d of gas before the suspension. “We have request from Bharat Petroleum, Indian Oil and Gail for gas,” Balyan said.

State-run Bharat Petroleum Corp and Indian Oil Corp refine crude and sell fuel products including gas to retail customers, while Gail (India) Ltd is India’s main gas transporter.
A BG spokeswoman didn’t immediately comment on the current status of production at Panna-Mukta. Petronet LNG, India’s largest LNG importer by volume, last bought a spot cargo in December. It stopped buying spot cargoes due to lack of spare pipeline capacity for gas transfer despite rising demand.

Balyan said also Petronet LNG is seeking more long-term LNG contracts with Australia and Qatar to hedge against price fluctuations and for full capacity utilisation of its terminal. Petronet LNG owns a 10mn-tonnen-per-year facility at Dahej in Gujarat and is building a 2.5mn-ton terminal at Kochi in the southern state of Kerala. It expects to commission the Kochi terminal by the middle of 2012.- Gulf Times