Energy Minister Saad Sherida al-Kaabi who also doubles as head of Qatar Petroleum in a visit in the Indian capital, Delhi, said the tiny gas-rich country will not re-negotiate the price of the current contract.
“We are not renegotiating contracts; we stick with contracts – both sides,” Kaabi said in response to his host, India’s Minister of Petroleum, Dharmendra Pradhan.
Pradhan urged Qatar to cut the price arguing that spot LNG prices for fuel delivered currently at Indian ports are half the price of that in the long-term contract.
“The current formula of benchmarking gas prices with crude oil is not correct,” Pradhan pointed out.
“We must find a formula between the current practices and other international prices.”
Qatar currently ships around 8.5 million tons of LNG to India under the deal signed in 1999 and come into force in 2004.
The official also suggested that the cut in the price will spur India’s desire to increase demand considering surging domestic need of LNG.
“The surge in India’s energy requirements will not be incremental but exponential. India is rapidly expanding its gas infrastructure to cater to the needs of nearly 70% of our population. An estimated investment of $60 billion is lined up in building the gas infrastructure,” Pradhan said.