New Delhi: The Petronet LNG Board had just six months back disfavoured a USD 2.5 billion deal to buy 18 per cent stake in US firm Tellurian Inc's proposed Driftwood LNG terminal, and import 5 million tonnes LNG a year from it for 40 years as the gas was available in plenty and no longer required equity investments, sources said.
Petronet on September 21 signed a Memorandum of Understanding (MoU) with Tellurian "wherein Petronet and its affiliates intend to negotiate the purchase of up to five million tonnes per annum (5 mtpa) of liquefied natural gas (LNG) from Driftwood, concurrent with its equity investment, which remains subject to further due diligence and approval of its board of directors," according to a joint statement.
Officials privy to board deliberations said the issue was discussed at the company's board meeting in April/May and members felt that the company should not go ahead with the deal due to changing global gas market dynamics, where the fuel is available in abundance at rock bottom prices. Locking imports for 40 years together with an equity investment in the LNG terminal was not favoured, they said, adding Petronet's promoters, including state-owned gas utility GAIL India Ltd, refiner Indian Oil Corp (IOC) and Oil and Natural Gas Corp (ONGC), were all against the deal.
Company managing director and CEO Prabhat Singh neither answered calls and nor replied to text messages sent for comments. Petronet is a firm promoted by GAIL, IOC, ONGC and Bharat Petroleum Corp Ltd (BPCL), and Secretary to Ministry of Petroleum and Natural Gas, Government of India, is its chairman.
