Modi’s American LNG deal: It is all about price

Modi’s American LNG deal: It is all about price

It is not for the first time that American LNG will flow into Indian network. But, if media reports from Houston are to be believed, then “Howdy, Modi!” has managed to create history as this is being tipped as among one of the largest liquefied natural (LNG) gas deals in the US.

However, what remains to be seen is how commercially viable it will be for the Indian consumers.

Have the Indian companies gone wiser, as the market here is very price sensitive. Will Prime Minister Narendra Modi, who is also seen as tough negotiator, strike a perfect deal?

Today, the landed cost of spot LNG at Indian shores is hovering around $ 5.5 per mmBtu (gas is measured in million British thermal units) and long-term is around $ 9.5 per mmBtu.

Transmissions cost, marketing margins, and local taxes and levies are added to this price before it is delivered to the end consumers. Read more

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