GAIL announced on Tuesday it had executed a long-term LNG sales and purchase agreement (SPA) with Vitol Asia, a unit of Vitol.
Under the SPA, GAIL will buy approximately 1 million metric tonnes per annum of LNG over a period of about 10 years, commencing in 2026.
GAIL said Vitol will deliver the LNG supplies from its global LNG portfolio.
The Indian firm said that the SPA follows the binding term sheet signed in January 2024.
GAIL noted that India emerged as the world’s fourth-largest LNG importer in 2024, with demand expected to rise steadily over the next decade.
The government of India has set an ambitious target to increase the share of natural gas in the country’s primary energy mix from the current 6 percent to 15 percent by 2030.
Supporting this vision, India’s LNG regasification capacity has seen substantial growth, nearly doubling from 21 mtpa in 2014, according to GAIL.
Sanjay Kumar, GAIL’s director of marketing, said the company is expanding its long-term LNG portfolio to meet demand growth.
“We are pleased to partner with Vitol Asia, and this agreement represents a key milestone in reinforcing GAIL’s capability to reliably serve its diverse and evolving customer base,” Kumar said.
GAIL is an end user for LNG and sells regasified LNG to customers in the fertilizer, city grid, power, refinery, and petrochem sectors, amongst others in India.
The firm owns and operates a large network of natural gas pipelines in India.
In addition, it holds a stake in India’s largest LNG importer, Petronet LNG.
GAIL has a diversified LNG sourcing portfolio for over 15 mtpa, which includes supply sources from various geographies both on FOB and DES basis.
The long-term contracts include volumes from the US, Qatar, and the UAE.
GAIL also has a fleet of chartered LNG carriers.
