GAIL (India) Limited's subsidiary GAIL Global USA LNG LLC has signed a sourcing agreement with US-based company WGL Midstream Inc. ('WGLM') for procurement of natural gas required to produce about 2.5 MTPA of LNG at the Cove Point Terminal located in Maryland, US. WGLM is a subsidiary of WGL Holdings Inc., a prominent natural gas company of the United States.
The definitive gas sale and purchase agreement has been signed for a period of 20 years and supplies are expected to commence from late 2017 when the LNG terminal, in which GGULL holds liquefaction capacity, becomes operational.
On the occasion, Mr. Terry D. McCallister, Chairman, Chief Executive Officer, WGL Holdings, Inc. said "WGL Midstream's long-term relationship with GAIL capitalizes on the growing supply of abundant natural gas from the Marcellus Shale production region. This growing supply source has been providing clean burning natural gas to Northeast and Mid-Atlantic regions of the United States and now will supply the country of India as well."
Commenting on the development, Mr. B. C. Tripathi, Chairman and Managing Director of GAIL, said "We are delighted to partner WGLM which is a part of a group having a rich history of over 160 years in natural gas supply business in the mid-Atlantic region. This agreement is another milestone towards GAIL's efforts in sourcing of LNG to meet the rising demand of gas in the Indian market. We are now in the process of chartering of LNG ships thereby entrenching our presence across the complete LNG supply chain and bring more value to the Indian customers".
PetroWorld 051214 Source: EquityBulls