BG and Conoco favourite to supply LNG to Mundra
GSPC has shortlisted British Gas and US-based ConocoPhillips as the two leading contenders to supply long term LNG to its proposed Mundra LNG terminal.
Yet GSPC is still actively considering Japanese-based trading giant Mitsui for a 25% stake in the project, as its ‘strategic partner.’ This follows a radical re-think over strategy for the Mundra LNG project, which GSPC (50%) is jointly promoting with Adani Energy (25%).
Earlier, GSPC wanted to give the remaining 25% stake in the proposed 5m t/y terminal project to a ‘strategic’ partner who could also ensure long term LNG supplies. But last month (April) GSPC dramatically reversed its long-held position and decided that offloading the remaining 25% stake and securing long term LNG supplies should be treated separately.
“It is no longer necessary for the third partner at Mundra to be the sole long-term LNG supplier,” confirms a GSPC source. “It is always better to have multiple sources.
” ConocoPhillips, they argue, could supply LNG to Mundra from its Australian LNG facilities, while BG could source LNG from it facilities in Egypt or Trinidad and Tobago. Some GSPC insiders believe ConocoPhillips, BG and Mitsui could share the supply of long-term LNG to Mundra.
Last September, BG became the first company to submit a written proposal committing to supply 2m t/y of LNG to the Mundra project. Elsewhere, GSPC is still talking to Mitsui about its willingness to secure 25% in the Mundra divestment.
GSPC received approval from the Gujarat government in February to seriously consider Mitsui's bid - attracted by the Japanese giant’s renowned engineering and technical expertise, particularly in earthquake-prone zones where it has gained a formidable reputation for designing quake-proof constructions. Mundra is located in Gujarat's north-west Kutch district - a desert landscape heavily prone to earthquakes.
