The last hurdle for GAIL India Ltd to import liquefied natural gas (LNG) from the Cove Point Terminal in the US has now been cleared, with the American company Dominion receiving approvals to build the terminal.

On Monday, the US Federal Energy Regulatory Commission authorised Dominion to build the Cove Point Liquefaction Project for export of up to 5.75 million tonnes (mt) of LNG annually.

GAIL has booked a capacity of 2.3 mt from the terminal.

The company’s earlier project to import 3.5 mt of LNG annually from Sabine Pass Terminal in Louisiana, US, had already received approvals.

GAIL expects to get supplies from the two projects in the US from 2017-18. The company hopes to sign more deals with the US for sourcing LNG.

LNG export to India from the US is seen as a game changer in the bilateral trade and investment ties between the two countries. According to trade experts, it will not only help address the current imbalance in goods trade, in favour of the US, but also result in investment of billions of dollars in the US by Indian companies.

The entry of LNG supply from US in global markets, and even an indication of the possibility of LNG exports from the US to major global consumers will have a beneficial impact on rectifying the current anomalies in global gas prices.

India is hoping that the US will agree to sell LNG to the country by exempting it from the requirement of a compulsory free trade agreement.

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