GAIL (India) Ltd Expands LNG Fleet With New Long-Term Charter Contract

GAIL (India) Ltd, the state-owned gas utility, announced a significant milestone in its global LNG operations by entering into a long-term time charter contract with Kawasaki Kisen Kaisha Ltd (“K” LINE). This collaboration facilitated through a Singapore-based ship-owning entity, marks the first such agreement between the two companies for a newly built LNG vessel, which is expected to commence operations in 2027.

Key Highlights

• Vessel Details:
  • The LNG carrier, designed as a modern two-stroke ship, will feature a tank capacity of 174,000 cubic meters.
  • The ship will be constructed by Samsung Heavy Industries Co Ltd, Korea, under a shipbuilding contract finalized by the owning company.
• GAIL’s Fleet Expansion:
  • Currently operating four LNG vessels (GAIL Bhuwan, GAIL Urja, Grace Emilia, and Maran Gas Pericles), GAIL plans to add two more ships next year, including one on a long-term charter.
  • The company aims to enhance its LNG transportation capabilities to support its diversified supply portfolio of over 15 MMTPA (Million Metric Tons Per Annum) sourced globally.
• Strategic Operations:
  • The new ship will primarily transport LNG from North America to India, catering to domestic demand and international customers.
  • This aligns with GAIL’s commitment to securing LNG through FOB (Free on Board) contracts while maintaining a reliable supply chain.

Industry Expertise

“K” LINE, with 40 years of experience in LNG transportation, will bring its expertise to ensure efficient and sustainable operations for GAIL’s growing LNG business.

Broader Implications

• Fleet Modernization: The addition of state-of-the-art LNG vessels underscores GAIL’s focus on advanced, sustainable technology to improve operational efficiency.
• Market Dynamics: This step reflects GAIL’s strategy to strengthen its global footprint in LNG markets amid rising demand for cleaner energy.
• Stock Market Impact: GAIL’s shares gained momentum, closing at ₹198.75, reflecting investor confidence following this announcement.

This partnership is a significant development for GAIL, aligning with its long-term goals of energy security and expanding its role in the global LNG market.