Gas Authority of India Limited (GAIL) has executed a long-term liquefied natural gas (LNG) sales and purchase agreement (SPA) with Vitol Asia, a unit of the Switzerland-based energy and commodities company Vitol.
Representing a formalization of the binding term sheet from January 2024, the deal entails an annual supply of approximately 1 million metric tonnes per annum (mmtpa) over a period of about 10 years, starting in 2026. Volumes will be supplied from Vitol’s global LNG portfolio.
Sanjay Kumar , Director of Marketing at GAIL, said: “GAIL is expanding its long-term LNG portfolio to meet demand growth. We are pleased to partner with Vitol Asia Pte. Ltd., and this agreement represents a key milestone in reinforcing GAIL’s capability to reliably serve its diverse and evolving customer base.”
At the start of the year, GAIL was one of the three Indian companies that inked a deal with Argentina’s YPF for 10 mmtpa of LNG from its proposed Argentina LNG project.
According to GAIL, India emerged as the world’s fourth-largest LNG importer in 2024, with demand expected to rise steadily over the next decade. The country’s government has therefore set a target to increase the share of natural gas in the country’s primary energy mix from the current 6% to 15% by 2030.
In line with this, the country’s LNG regasification capacity has seen substantial growth, nearly doubling from 21 mmtpa in 2014.
Vitol Asia’s Chief Financial Officer (CFO) Jay Ng said the growing Indian market is core to his company’s strategy, adding that Vitol’s diversified portfolio enables it to offer India a stable supply of cleaner and competitive energy.
In May, Vitol inked a deal with Oman LNG to buy 800,000 metric tons per annum (mtpa) of LNG. The firm believes the agreement will enhance its capacity to meet the evolving energy requirements of its customers worldwide.