Petronet LNG has renewed its initial deal to consider investing $2.5 billion in U.S. liquefied natural gas (LNG) developer Tellurian Inc’s (TELL.O) Driftwood project.
Petronet and Tellurian now have until the end of December to finalize the deal. Developers have delayed numerous North American LNG projects this year due to a sharp downturn in global gas prices. LNG supply increased by a record amount in 2019, and the coronavirus has sapped overall fuel demand.
The companies signed a non-binding agreement in September 2019, in which Petronet agreed to negotiate the annual purchase of up to 5 million tonnes of LNG, over the lifespan of the project, concurrent with an equity investment in Driftwood.
That deal lapsed on May 31, and was renewed last week ahead of a virtual meeting between Indian oil minister Dharmendra Pradhan and U.S. Energy Secretary Dan Brouillette.
India is expanding its pipeline network and building LNG import terminals to encourage use of cleaner fuel. Prime Minister Narendra Modi has set a target to raise the share of gas in India’s energy mix to 15% by 2030 from 6.2% now.
