Govt interested in joining Asian grouping to buy LNG

The ministry of petroleum and natural gas on Friday showed interest in joining an elite consortium of China, Japan and South Korea to import liquefied natural gas (LNG).

Early this week, Japan’s JERA, South Korea’s Korea Gas Corporation, and China National Offshore Oil Corporation had signed a memorandum of understanding to discuss opportunities of collaboration in the LNG business.

Asked about this, Petroleum Minister Dharmendra Pradhan said, “China and India are the biggest consumers in the region. India will be keen to be part of any kind of consumer-centric common strategy. I am not ruling out India joining the consortium.”

The grouping is being seen as a strategic move by Asian consumers to have more flexible supply contracts and ensure availability of cheaper | Japan, South Korea and China had signed an MoU to jointly import LNG | They plan to cooperate in upstream projects, in LNG shipping and storage, and in joint procurement of LNG LNG. The three countries also plan to co-operate in upstream projects, in LNG shipping and storage, and in joint procurement.

Pradhan on Friday said the Budget announcement by Finance Minister Arun | India, Japan, South Korea, China and Taiwan initiated talks in 2014 for joint purchases Jaitley to create an integrated oil behemoth would bear fruit in 2017-18.

There was speculation that oil and gas major Oil and Natural Gas Corporation (ONGC) would acquire Hindustan Petroleum (HPCL), another oil public sector undertaking, for ~40,000 crore. Such a move would make ONGC the third largest petroleum refining company in the world. There were also media reports about a possible merger between BPCL with ONGC, and Oil India with Indian Oil Corporation.

Speaking on the sidelines of the launch of a dedicated grievances redressal platform, eSeva, Pradhan said, “We have asked the companies to appoint consultants and come out with reports. We will only act as a policy initiator. The merger will be corporate decision by the companies.”

The concept of an integrated oil major was first mooted by the Atal Bihari Vajpayee government and in 2002 the then oil minister Mani Shankar Aiyar had appointed an expert committee to look into it. However, the committee headed by V Krishnamurthy batted for more autonomy for oil and gas majors, and the idea was shelved.