In a move to strengthen energy cooperation between India and the United States, PM Narendra Modi, on the first day of his visit to the US announced that India’s largest LNG importer Petronet will invest $2.5 billion in Houston-based Tellurian’s proposed Driftwood LNG export terminal, in exchange for rights to 5 million metric tonnes of LNG per year over 40 years. The agreement also includes PLL making investment in the equity of USD 28 billion Driftwood project in Louisiana to secure the LNG. The deal will increase India’s energy imports from the US and help reduce trade deficit, which US President Donald Trump has often complained about in the past.
Modi’s first engagement in Houston was a CEO round-table with oil majors. MEA spokesperson Raveesh Kumar said CEOs of 17 global energy companies participated in the round-table. The combined net worth of these companies, he said, was $1trillion and they together had presence in 150 countries. “...Objective of the meeting was to deepen our energy cooperation as part of our strategic energy partnership,’’ said Kumar.
“On the sidelines, an MoU was signed between Tellurian and Petronet LNG. Petronet will invest USD 2.5 billion in Tellurian's proposed Driftwood LNG export terminal, in exchange for the rights to 5 million metric tons of LNG per year over 40 years," MEA spokesman said. The Petronet deal, the largest by an Indian company in US LNG, came after PM Modi had a meeting with the CEOs of top US-based oil companies. “CEOs talked about enhancing their footprint in India. They lauded the government’s efforts towards ease of doing business, ...deregulation in the sector, supported reforms and policies and were upbeat on the Indian economy.’’ “It is an honour to sign the MoU with Petronet in the presence of PM Narendra Modi. At Tellurian, we look forward to a long and prosperous partnership with Petronet in the Driftwood project,” Tellurian’s president and CEO Meg Gentle said.
Petronet will spend $2.5 billion for an 18% equity stake in the Driftwood LNG terminal - the largest outside holding so far in the project - and negotiate the purchase of 5 million tonnes of gas per annum, Gentle said. Tellurian and Petronet will endeavour to finalise the transaction agreements by March 31, 2020, they added. The Driftwood project includes natural gas production, gathering, processing and transportation facilities, along with Driftwood LNG, a proposed 27.6 mtpa liquefaction export facility that will be located near Lake Charles, Louisiana on the US Gulf Coast.
