ADNOC to Supply 2.5 Million Tons of LNG to BPCL in New Deal

Abu Dhabi National Oil Company (ADNOC) has entered into a new five-year agreement to supply 2.5 million tons of liquefied natural gas (LNG) to India’s Bharat Petroleum Corp (BPCL). According to sources familiar with the matter, BPCL will receive 40 cargos of LNG under this contract, with deliveries commencing from April.

The initial phase of the deal will see gradual ramp-up in supplies over the first two years, providing a steady stream of LNG to BPCL. The agreement is expected to be formally signed during the India Energy Week conference, where ADNOC will also finalize a sale purchase agreement with Indian Oil Corp (IOC) for a 15-year LNG deal that was agreed upon in September last year. Deliveries under the ADNOC-IOC deal are set to begin in April next year.

While ADNOC refrained from commenting on the specifics of the commercial negotiations, the significance of these agreements cannot be understated. India, the world’s fourth largest importer of LNG, is aiming to significantly increase the share of gas in its energy mix to 15% by 2030, up from the current 6.2%.

Furthermore, Indian energy companies are exploring opportunities to diversify their LNG sources, with a focus on potential imports from the United States. Oil Secretary Pankaj Jain highlighted this strategic shift in sourcing during a recent statement, indicating the growing importance of LNG in India’s energy landscape.

As these deals take shape, they not only strengthen the energy ties between India and the UAE but also reflect the evolving global LNG market dynamics. With a clear focus on sustainability and energy security, collaborations such as the ADNOC-BPCL agreement pave the way for a more diversified and resilient energy future.

(Source: Reuters – Reporting by Nidhi Verma; editing by David Evans)