Diversify LNG imports to India away from Gulf

Vol 8, PW 26 (06 Apr 05) People & Policy

A series of recommendations circulating in the Indian oil ministry could see India reduce its dependence on LNG from the Gulf region.

An internal note dated 1st March 2005, prepared by joint secretary Prabh Das, speaks at length about what India must do to ensure the security of its LNG imports. Energy security would dictate diversification of sources to as many suppliers as possible, economically and securely, the report says.

Conversely, LNG suppliers should be those who do not supply oil to the country. Das admits that this option might not be achievable but argues strongly that it must be considered as India enters into more and more long-term contracts for LNG.

For if a disruption disables oil supplies in a country, there is an increased likelihood that LNG supplies (from that country) would also be affected. Das points out that 67% of Indias crude imports come from west Asia.

Therefore LNG imports, to enhance our energy security, should come from countries other than west Asia. He then suggests that India should look at countries like Indonesia, Australia, Malaysia and nine others, which currently export LNG that totals up to one third of the worlds total proven recoverable gas reserves.

The most significant gas reserves by far are in Qatar followed by UAE and the US, says the Das report. Among LNG exporters in the Asia Pacific, the largest proven recoverable gas reserves are in Indonesia, Australia and Malaysia.

The other countries are: Brunei, Trinidad & Tobago, Libya, Algeria, Nigeria and Oman. Also highlighted is the availability of natural gas from the Russian Federation and Iran, which have the worlds largest proven recoverable natural gas reserves.

They do not export LNG, writes the report. But both countries have plans to do so by end of the decade.

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