- Petronet LNG is negotiating with Qatar to recover delayed LNG shipments due to Middle East crisis
- Around 90 LNG cargoes remain pending from Qatar, including delays from 2015-16 pricing disputes
- Petronet's contract with Qatar extended to 2048, aiming for earlier delivery of delayed cargoes
Petronet LNG, India's largest gas importer, is negotiating with Qatar to recover delayed liquefied natural gas (LNG) shipments as the Middle East crisis disrupts supplies.
The company wants to secure early deliveries once the situation normalises to meet India's growing gas demand, Chief Executive Officer A.K. Singh said, as per Reuters.
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Around 75-80 cargoes under Petronet's existing agreement with Qatar have been delayed because of the conflict. Another 15-16 cargoes were not delivered in 2015-16 due to pricing disputes. It takes the total number of pending shipments to at least 90, Singh said.
Qatar is India's largest LNG supplier. Under its long-term agreement, it is required to supply Petronet with 7.5 million metric tonnes of LNG annually, equivalent to around nine to 10 cargoes every month.
QatarEnergy has extended force majeure on LNG supplies until the end of 2026. While the contract allows Petronet to receive delayed cargoes within the contract year ending April 2029, the company is pushing for earlier deliveries.
The agreement, originally due to expire in April 2028, has been renewed for another 20 years. The revised contract will remain valid until 2048.
Also Read | Iran Signals Reopening Strait Of Hormuz 'Within Two Days' If US Accepts Key Demands
Singh said buyers must consider security, reliability and shipping routes alongside prices.
Petronet has expanded its Dahej terminal in Gujarat to handle 22.5 million tonnes annually, up from 17.5 million tonnes. Singh said the facility could accommodate higher supplies in 2028-29.
However, most of its capacity has been leased to state-run oil companies. These companies hold LNG import contracts for around 10-12 million tonnes annually. Some of their supplies from Middle Eastern producers have also been delayed by the disruption.
Also Read | Freight Shock: Indian Refiners Face Up To $20/Barrel Shipping Bill, Margins Hit
Middle East crisis puts energy supplies under pressure
The disruption around the Strait of Hormuz has raised concerns over the reliability and cost of energy shipments to India. Indian oil refiners have seen crude transportation costs rise to $12-$20 per barrel from $8-$10, sources told NDTV Profit. The increase has added $4-$10 per barrel to shipping expenses, depending on the route.
Physical crude cargoes are also trading at nearly $20 per barrel above Brent futures. Higher freight costs have influenced sourcing decisions, with refiners leaning more towards Middle Eastern crude during October and November.
India is now considering diversifying its LNG import sources to reduce dependence on vulnerable supply routes.
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