Shell, Petronet sell gas on spot basis
1-Jan-1970


Soaring crude oil prices coupled with non availability of gas under the long term contracts have opened a new opportunity for gas industry players.Gas importing companies such Petronet LNG and Shell Hazira have started selling gas on a spot basis. Through each cargo, Petronet LNG is selling around 1.35 lakh cubic meter gas on a spot basis, which is in addition to its 5 million tonnes of gas supply under the long term contracts.

According to sources, in the last five months, Shell Hazira and Petronet LNG have struck many such deals in the recent past and are selling the gas after importing the cargo at Hazira and Dahej terminals, respectively.

?As there is huge demand for gas, we have decided to import three spot cargoes in every two months,? A Sengupta, director-finance, Petronet LNG said.

Although the spot price of LNG is 70-100% higher than gas sold under the long term contracts, increasing number of imported spot cargoes indicate that the spot market for gas has been developing on the back of strong demand, Dhiren Desai, chief executive officer, Ethical Energy and Petrochemicals, a leading gas constancy firm, said.

Desai said that majority of demand for spot gas come from industries like power, fertilisers and steel. Spot gas is still 35-40% cheaper than naphtha, which has been used by these industries as an alternative fuel.

NEW VISTA

Increasing number of imported spot cargoes indicate that spot market for gas has been developing on the back of strong demand mainly from power fertilisers and steel industries.




Source: The Times of India, Ahmedabad
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