Global energy major Exxon Mobil Corp and Indian Oil Corp (IOC) have signed an agreement to help deliver natural gas in containers to Indian cities outside the pipeline network. The move is set to significantly ramp up gas usage in the country and deepen US-India energy ties.
The US is emerging as an important energy supplier for India, with total crude oil and LNG imports worth an estimated $6.7 bn, according to official data.
Imports of the two commodities in April-December 2019 have already surpassed the shipments during the entire previous fiscal year.
Chart Energy & Chemicals — a US company specialising in the supply chain of liquefied gas — will also be a part of the 'letter of cooperation' along with ExxonMobil India LNG and state-run IOC.
“By linking our global expertise with other leading players, we can create strong and reliable pathways for gas to move quickly and efficiently to where it is needed,” Alex Volkov, chairman, ExxonMobil LNG Market Development, said in a statement.
The partners hope to make virtual pipelines to fuel factories, households and vehicles in cities not connected to the gas grid.
The agreement is expected to help India achieve its target of raising the share of gas in the energy basket to 15% within the next decade, up from 6.2% today.
In a bid to reduce its dependence on the volatile Middle East region, India has started importing LNG and crude oil from the US in the past three years and trade is growing rapidly.
Purchase of LNG from the US by Indian companies rose from $155 mn in FY17 to $527 mn FY19.
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