Petronet signs MoU with LTL Holdings to supply LNG to Sri Lankan power plants

The Government of India established Petronet LNG Limited as an oil and gas company with the purpose of importing liquefied natural gas and establishing LNG terminals within the nation. Petronet LNG was established in 1998 with the aim of diversifying India’s energy sources and reducing its reliance on traditional fuels such as coal and oil. The company has been instrumental in addressing the increasing demand for natural gas in India, which is recognized as a cleaner and more sustainable option compared to other fossil fuels. Over the years, Petronet LNG has expanded its operations and currently operates four LNG terminals across the country, with plans for future expansion. The company has also established strategic partnerships with international suppliers to guarantee a consistent supply of LNG to fulfill India’s energy requirements. Petronet LNG has been instrumental in transforming India’s energy landscape and promoting the use of natural gas as a cleaner fuel option. The company continues to play a key role in ensuring energy security for the country while also contributing to its efforts towards reducing carbon emissions and combating climate change.

Petronet 5 years MoU:

According to a stock exchange filing, Petronet LNG Limited (PLL) and LTL Holdings Limited (LTL) of Sri Lanka signed a Memorandum of Understanding (MoU) on August 20, 2024, in Colombo, Sri Lanka, for the supply of LNG to LTL’s dual-fuelled power plant(s) in Kerawalapitiya, Colombo.

Under the terms of this MoU, both parties will work together to create a comprehensive LNG supply chain that uses LNG ISO tank containers and a multi-modal transport system to move LNG from PLL’s Kochi LNG terminal to LTL’s power plants in Colombo. The LNG supply has a five-year initial term with options for mutually agreed-upon extensions.

The proposed supply of LNG from PLL’s Kochi LNG Terminal would be through LNG ISO tank containers involving a multi-modal transport system. The world’s largest LNG import terminal operator stated that the initial term of LNG supply would be five years, with the possibility of extension upon mutual agreement.

Petronet LNG Limited (PLL) imports 17.5 million metric tons a year:

Petronet runs a flagship import terminal in Dahej, Gujarat, that handles 17.5 million metric tons annually, as well as a 5 million-tonne facility in Kochi, Kerala. The gas utility GAIL (India) Ltd, the oil and gas producer ONGC, and the state-owned refiners Indian Oil Corp (IOC) and Bharat Petroleum Corp Ltd (BPCL) own 50% each of the company. The Secretary of the Ministry of Petroleum and Natural Gas is in charge of the board, which is composed of the four companies.

Petronet share decline: 

Petronet stock price today is Rs. 376.80 per share, showing an almost 1% decline intraday.

Conclusion: Petronet LNG Limited (PLL) is taking the next level of steps for the export business with the current deal.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.