In a move aimed at boosting India’s long-term energy security and strengthening trade ties with the United States, GAIL (India) Limited has floated an Expression of Interest (EOI) for acquiring up to 26% equity in a US-based LNG (liquefied natural gas) project. The public sector gas giant is also seeking a 15-year LNG supply contract, with the possibility of extension, signalling a strategic step forward in India-US energy collaboration. This development comes as India plans to scale up its oil and gas imports from the US, following Prime Minister Narendra Modi’s meeting with former US President Donald Trump.
Long-Term LNG Sourcing and Equity Proposal
According to the EOI reviewed by CNN-News18, GAIL is looking to source 1 Million Metric Tons Per Annum (MMTPA) of LNG from an operational or upcoming natural gas liquefaction facility in the US. The proposed supply arrangement would start between 2029 and 2030, with a Free on Board (FOB) agreement for a 15-year period, extendable by another 5 to 10 years on mutual agreement. GAIL clarified that the LNG must be sourced from a seller with legal rights to export LNG from the selected project.
In terms of investment, GAIL has expressed interest in acquiring a stake in either an existing project or one scheduled to become operational by 2030. The company has laid out specific equity participation plans depending on the project’s capacity: up to 26% for facilities with capacity up to 5 MMTPA, 15% for capacities between 5 and 10 MMTPA, and 10% for those exceeding 10 MMTPA.
Equity Investment Conditions and Ownership Structure
The EOI outlines two scenarios for exercising GAIL’s equity option. If the entire value chain—from asset ownership to LNG sale rights and operations—is managed by a single entity, GAIL would invest directly in that company. However, if different entities handle various aspects of the project, GAIL will seek equity in the holding company with full ownership of the LNG value chain.
The EOI clearly states that this invitation is non-binding and intended to gauge market interest. Bids must be submitted by April 28, underlining the project’s urgency. GAIL, which operates across the entire natural gas value chain in India, sees this move as part of its broader strategy to secure reliable international energy sources while enhancing India’s position in the global gas market.
