NEW DELHI: Gas Authority of India Limited (GAIL) is teaming up with a unit of French group EDF to jointly scout for natural gas assets in the United States as demand in India grows, its chairman said.
“We will be working together for gas trading, gas sourcing and acquisition of gas based assets,” B. C. Tripathi said, ahead of a 10-day visit to the United States beginning on Saturday with oil minister Veerappa Moily.
He said state-owned GAIL would sign an agreement with EDF Trading. On Friday India enhanced GAIL’s financial powers, allowing the firm to take investment decisions of up to 50 billion rupees ($940 million) without going to the government.
India, the world’s fourth-largest oil importer, imports about 80 per cent of its crude needs, and has been scouting for oil and gas assets overseas to satisfy rising local demand and expanding refining capacity.
Problems at the Reliance Industries-operated D6 block, off India’s east coast, have curtailed domestic gas output while state-run Oil and Natural Gas Corp is struggling with declining production at its ageing fields.
The company’s head of marketing Prabhat Singh said it was an appropriate time to a strike deal in the United States, where shale gas development has led to a glut in the gas market, causing prices to plummet and meaning the government may consider exports to energy-hungry Asia.
India has asked the United States to supply liquid shale gas, a government source said in May, as it continues to reduce dependence on oil imports from Iran. GAIL was conferred the ‘Maharatna’ status by the government. An oil ministry statement here said GAIL was the third company under the ministry and the youngest among all public sector units (PSU) to be given this recognition. A Maharatna firm can take investment decisions up to Rs50 billion without going to the government.