Gujarat State Petroleum Corporation (GSPC) entered into a preliminary agreement with BG India, subsidiary of the BG Group, for the long term supply of up to 2.5 million tonne per annum (mtpa) of liquefied natural gas (LNG). The agreement will help GSPC bridge the widening demand-supply deficit, both in Gujarat and across India. BG India proposes to sell the LNG volumes to GSPC for up to a 20 year period, beginning as early as 2014.GSPC and BG India intend to complete negotiations and execute a binding LNG sale and purchase agreement early next year. The LNG volumes will be sourced from BG Groupâ€™s current and future gloÂbal supply portfolio.
GSPC envisages a significant role in bringing the benefits of natural gas as a cleaner fuel to Gujarat and beyond, considering the huge latent demand. In a statement issued earlier this week, it said that on completion of the three pan India pipelines to be set up by its group company, GSPL, in the next three years, it would have access to markets across the country.