Monday, 29th May 2023
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India partners South Korea, Japan on LNG deal

India has restarted talks on a liquefied natural gas (LNG) purchasing alliance with Japan and South Korea and may also include China as Asian demand for the fuel grows.


India has restarted talks on a liquefied natural gas (LNG) purchasing alliance with Japan and South Korea and may also include China as Asian demand for the fuel grows.

“For the next two to three decades, gas is going to be a major part of the energy basket for Asian energy consumers,” Dharmendra Pradhan, Indian minister of petroleum and natural gas told reporters in Mumbai

Pradhan was quoted by Reuters as saying: “We want to bring together the countries and form a network which can together source reasonable, rational and affordable LNG,” adding that talks with Japan and South Korea have begun and China may also come onboard as a partner.

State-owned GAIL Limited is spearheading the talks, which follow a similar attempt in 2013, on India’s behalf.

Natural gas currently accounts for about 8 percent of India’s overall energy mix. In the last decade, while India’s domestic natural gas production has grown by 10 percent, imports of LNG have risen by 335 percent.

This is likely to grow further as India gradually shifts to a gas-based economy, the minister told Reuters in a recent interview.

India’s gas demand stands at 120 million standard cubic meters per day (mscmd) whereas domestic supply is 80 mscmd, making imports imperative, government data showed.

Meanwhile, South Korean shipping company, Hanjin Shipping has revealed its plans to turn to creditor-led debt restructuring as part of efforts to improve its financial situation.

Faced with an outstanding debt of $406 million due in the first half of this year, the company, according to stock exchange filing is now aiming to improve the financial structure and “normalize” its management.

Although the company managed to return to profit in 2015 after cutting a number of its costs, Hanjin according to World Maritime decided to take further measures to remain in black during 2016 as the freight rates are expected to resume already reached record lows.

Also, the company agreed to sell its office building in London in March for $57.2 million and it has further plans to dispose of certain overseas terminals and treasury stocks in an effort to deal with the current depression in the shipping industry.

In a related development, despite a marginal deterioration in the growth outlook for the global shipbuilding industry, annualised five-year growth rates for the sector are still forecast to reach a healthy three to five per cent before picking up substantially after 2017.
According to Castrol Marine Trade Barometer, growth will be driven largely by the Asia-Pacific region coupled with  Latin America and the Middle East.

The Barometer explained that all European nations but the Netherlands face a downward trend until 2017.
Chief Operating Officer at Castrol, Mandhir Singh, was quoted as saying “The main growth in shipbuilding will come from Asia-Pacific countries to 2019. These nations are well positioned to supply ultra-large vessels, which shipping companies are increasingly demanding for their fuel efficiency and economies of scale.
 “Traditional shipbuilding nations, like Germany and the United Kingdom, will need to up their game if they’re to compete with the colossal shipyards and deep ports of the Asia-Pacific region, ” said Singh
Based on the report, Hong Kong seems to be the biggest success story, overtaking South Korea and China to become the world’s second largest ship-parts trading nation.