NEW DELHI: India will reiterate its demand for additional supply of three million tonnes of LNG when the Emir of Qatar arrives for a state visit next week.
The Emir, Sheikh Hamad bin Khalifa Al Thani, will be on a state visit from April 8 to 10, and accompanied by his wife Sheikha Mozah bint Nasser al Missned, senior ministers, officials and businessmen.
Qatar supplies over 55 percent of India’s total LNG requirement, but with a growing economy will require more.
“We expect to increase our supply from 7.5 to 10.5 million metric tonnes. That is, we need 3 million metric tonnes immediately,” said a senior government official.
India currently imports 15.6 million tonnes of LNG.
“We expect this to keep on increasing. In the next three to five years, our immediate requirement will be close to 15 metric million tonnes,” he added. While India has made this demand several times, the negotiations have been stuck due to price issue.
On Tuesday, Petroleum Minister Jaipal Reddy held talks with his visiting Qatari counterpart Mohammed bin Saleh al Sada.
He indicated to reporters that pricing continued to be a sticking point, noting that gas in India has to compete with cheaper fuels like coal, especially in the power sector.
“On the pricing front, however, a major challenge is that for end consumers in India, gas has to compete with relatively cheaper fuels such as coal, especially in the power sector. Therefore, price fixation for gas, whether LNG from abroad or gas through trans-national pipelines, will have to be mindful of this reality,” Reddy said on Tuesday.
The minister expressed hope that the two countries would soon work out a realistic price mechanism for the new gas supply. “I am sure that the ongoing pricing negotiations between RasGas, Qatar and Petronet LNG Ltd and other oil companies in India will soon reach fruition, to the satisfaction of both sides,” he said.