U.S. LNG FOR INDIA

PLATTS - 26 Oct 2020 - The US wants to reduce trade and investment barriers to allow more LNG to be exported to India to meet growing demand in the world's second most populous country, Energy Secretary Dan Brouillette said Oct. 26.

During a video message to delegates of the India Energy Forum by CERAWeek, Brouillette said the US' all-of-the-above approach included oil and renewable resources and was designed to facilitate the global energy transition.
The US was the fifth-largest supplier of LNG to India in 2019, according to the Department of Energy. India's Gail was a foundation customer at Cheniere Energy's Sabine Pass export terminal in Louisiana, and multiple developers of new liquefaction terminals proposed for the Gulf Coast, including Tellurian, have been pursuing supply deals with Indian counterparties.

"The impact of the COVID pandemic on supply chains...has reinforced the importance of our relationship," Brouillette said in his message to the conference, which was being held virtually. 

India's energy appetite is a big draw for US exporters. 

While energy demand globally fell by almost a third at the height of the impact of the coronavirus pandemic, causing price instability and delays in investment decisions, India is expected to emerge as a leading global energy consumer and nearly double its energy consumption over the long term, Prime Minister Narendra Modi told the conference. 

"India believes that access to energy must be affordable and reliable," Modi said.

Tellurian's talks with India's Petronet about a potential equity deal tied to its proposed Driftwood LNG project in Louisiana have been reported to be continuing. Tellurian had most recently been targeting reaching a final agreement by the end of December. A spokeswoman did not immediately respond to a message seeking comment Oct. 26 on the status of those talks.

The two sides, which had first reached a preliminary agreement in September 2019 but failed to firm up terms by an end of May deadline, resumed talks in July. The original memorandum of understanding reached between Tellurian and Petronet called for the Indian company to negotiate taking a stake of up to $2.5 billion in the holding company that includes Driftwood. If finalized at the top end, Petronet would get the rights to 5 million mt/year of supply from Driftwood.

At full development of 27.6 million mt/year, about half of Driftwood's capacity is expected to be used by the equity investment partners Tellurian has been soliciting. The remaining capacity is to be retained by Tellurian to market on its own. To date, however, only France's Total has made a firm commitment to support the project -- a $500-million investment signed last year.

During a presentation on the first day of the India Energy Forum, Total CEO Patrick Pouyanne said his company expected to grow its LNG portfolio around the world over time. He did not address any further plans in North America, specifically.

"We are quite optimistic about the development of the LNG market," Pouyanne said.

Tellurian CEO Meg Gentle is scheduled to address the conference Oct. 27. 

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