Gail makes first stand-alone global LNG buy

Gail India has bought one spot cargo of 1,35,000 standard cu.mts. (scm) of LNG from Algeria.

According to an official release issued by Gail to the BSE today, this is the first-ever purchase of LNG cargo from the international market by Gail on its own. The cargo is expected to arrive at the Dahej LNG receiving terminal in the third week of this month and Gail is in the process of finalizing a second cargo in the month of June 2006.

The company will sell part of the LNG to cCompanies facing natural gas supply crunch. Power generation companies in Northern India, which is in the grip of a heat wave, facing serious supply shortages are high on Gail's list, the release said.

The Central Electricity Authority recently permitted the use of naphtha to meet the peak summer demand. Currently the domestic price of naphtha is as high as $ 20 per mmbtu equivalent of energy. The price of Algerian LNG will be a fraction of this price, the release said.

The company is confident of importing more spot cargos in the near future and is in touch with LNG sellers in the Pacific Basin, Atlantic Basin and the Middle East for future imports, the release added.