IOC's Henry Hub-linked Cameron deal
Since it was signed in January, people have been talking about IndianOil’s deal with Mitsubishi's subsidiary Diamond Gas to source 700,000 t/y of LNG from the Cameron LNG project in the US.
But now PETROWATCH can reveal that IOC will pay 115% of the prevailing Henry Hub rate plus liquefaction costs and a fixed premium. This deal is similar to GAIL’s two US LNG import deals.
“Only the quantity is less otherwise everything is similar,” says an LNG industry source. In 2011, GAIL signed a deal for 3.5m t/y from Cheniere Energy's Sabine Pass terminal in Louisiana and in 2013 it signed another 2.3m t/y deal from Dominion’s Cove Point terminal in Maryland.
Just like GAIL, the IOC deal is also for 20 years from 2017-18. Like GAIL, IOC too must hire LNG tankers as this is an FOB deal.
IOC and Diamond signed a MoU last November which was converted to an MSPA in January this year (2014). IOC chairman B.
Ashok announced the deal at the IOC gas conclave in Delhi on March 18.