In a move aimed at throwing a lifeline to its stranded gas-fired power plants, India proposed this week that a long-term liquefied natural gas (LNG) supply deal with Qatar include the proviso that Qatar acquires stakes in those plants.
Gas shortages have meant that a number of Indian power plants have shut down or are being run at lowered capacity.
Oil and gas minister Dharmendra Pradhan (pictured) said the deal would be of “mutual interest” and that Qatar would be able to “share the profits of these power plants”.
“If they want to have a long-term offtake assurance, there is a window. They can deal with our stranded power plants, from end to end they can give some solution,” Pradhan reportedly said, referring to Qatar’s status as both a producer and supplier of gas. He said Qatari LNG firm Rasgas “will get a market” in India as part of the deal.
India has an installed base of over 25 GW in gas-fired power capacity, contributing 7.6 per cent of its overall generation. Between April and May, these plants produced around 22 per cent of their capacity.
The country aims to boost its annual LNG imports to 50 million tonnes in the near future, up from the current figure of 21 million tonnes, to meet an expected jump in demand. India’s Petroleum and Natural Gas Regulatory Board predicts demand growth of 6.8 per cent per year to 2030, with gas-fired power contributing around 47 per cent of the total energy mix in that year.
India currently buys 8.5 million tonnes of gas from Qatar each year under a long-term contract, topped up with additional spot purchases.