It’s all garbage:
India’s renegotiated gas import deal with Russia’s Gazprom will save between Rs 8,500 crore and Rs 9,500 crore over the contract period ending 2040, Oil Minister Dharmendra Pradhan said today. State-owned gas utility GAIL India Ltd had in January taken advantage of the Russian company’s inability to deliver liquefied natural gas (LNG) from the previously agreed Schtokman project in the Barents Sea, to renegotiate price agreed in 2012.
…Without giving specific details, Pradhan said the gas price was negotiated depending on many factors like project location, duration of contract and pricing formula.
GAIL renegotiated the terms of the 20-year deal to import 2.5 million tonnes a year of LNG, including price and volume ramp up.
The contracted volume has been lowered from 2.5 million tonnes to 0.5 million tonnes in the first year, 2018-19; 0.75 million tonnes in 2019-20 and 1.5 million tonnes in the third year 2020-21.
The contract period has been extended by three years to accommodate the supplies not taken in initial years as well as getting an additional 2 million tonnes over-and-above the 50 million tonnes it had agreed to take in 2012 over the 20 year contract period.
India has been making the most of its position as one of the world’s biggest energy consumers to strike better bargains for its companies.
The chart:
If there was an LNG shortage coming then long term contracts would not be being broken and renegotiated down.
It’s just another argument in favour of domestic reservation for Australian gas. Drop local prices and tighten the international market for higher prices.
