State-run GAIL India on Monday said that it has signed a long term contract for procuring liquefied natural gas (LNG) from the Abu Dhabi National Oil Company (ADNOC) of 0.5 MTPA for a period of ten years beginning 2026.

“GAIL (India) has successfully concluded a long-term LNG purchase agreement for purchase of around 0.5 million tonnes per annum (MTPA) LNG from ADNOC Gas,” the country’s largest gas utility said.

This is pursuant to an MoU dated October 30, 2022, between GAIL and ADNOC P.J.S.C wherein the parties agreed that in potential areas of collaboration both parties shall explore opportunities including purchase of LNG by GAIL from ADNOC for a tenure ranging from short term to medium and long-term, it added.

This significant development between GAIL and ADNOC will reinforce the robust cultural and economic bonds between India and the United Arab Emirates (UAE).

Rising energy needs

“Under this agreement, the deliveries will commence from 2026 onwards for a duration of 10 years, across India. This arrangement is believed to further aid in India’s rising energy security requirements and, simultaneously, also fuel GAIL’s strategic growth objectives to cater to its downstream customers in the rapidly evolving Natural Gas landscape of the country,” GAIL said.

GAIL CMD Sandeep Kumar Gupta said the long-term LNG deal will contribute to bridging the gap in India’s demand and supply of natural gas and will open more avenues of strategic partnership between GAIL and ADNOC in other areas of energy domain.

Underlining the broader impact of the agreement, GAIL’s Director (Marketing) Sanjay Kumar said the transaction will help GAIL to augment its significantly large LNG portfolio to serve its diverse consumer profile.

The long-term LNG purchase agreement with ADNOC Gas is anticipated to fortify India’s energy security, foster economic collaboration, and propel both GAIL and ADNOC into new realms of strategic partnership.