India, Japan to join hands for LNG import

New Delhi: India and Japan on Wednesday agreed to explore joint cooperation in the areas of sourcing, swapping and optimisation of liquefied natural gas sources in the global market and commercial exploitation of methane hydrates.

In a bilateral meeting held in Tokyo on Wednesday, Petroleum Minister Dharmendra Pradhan and Hiroshige Seko, Minister of Economy, Trade, and Industry of Japan, signed a memorandum of cooperation on establishing a liquid, flexible and global LNG Market. India is the fourth largest importer of LNG in the world.

“The MoC provides a framework to cooperate in facilitating flexibility in LNG contracts, the abolition of Destination Restriction Clause and also explore possibilities of cooperation in establishing reliable LNG spot price indices reflecting true LNG demand and supply. This would help in promoting bilateral relationship between India and Japan in the LNG sector,” the ministry of petroleum and natural gas said in a statement.

The two sides discussed ongoing cooperation in the hydrocarbon sector between companies in India and abroad and explored ways to further enhance the engagement. Pradhan also invited Seko to attend the 16th International Energy Forum (IEF) Ministerial meeting to be held in New Delhi in April next year. In a conference organised by the Ministry of Economy, Trade and Industry of Japan (METI) and the Asia Pacific Energy Research Centre (APERC) participants were provided with a forum for sharing the latest trends in the global LNG market and discussing opportunities and challenges with a view to developing global LNG market.

Speaking on the conference, Pradhan stated that the global LNG market is undergoing a major transformation driven by new supplies which has created a situation of oversupply. He urged the global LNG markets, in which producers and consumers have equal stakes, to join hands to design flexible terms such as pricing review, flexible take or pay, abolition of destination restriction clause in the LNG contracts. He added that these reforms are essential for developing a transparent, efficient, truly global and balanced LNG market.

Pradhan also met Katsunobu Kato, Minister of Health, Labour and Welfare of Japan and discussed issues of bilateral importance on promoting cooperation in the skill sector. Both also signed a MoC on Technical Intern Training Program (TITP). The TITP is an ambitious program to send Indian technical interns to Japan for on-the-job training for a period of three to five years. The MoC is expected to pave the way for bilateral cooperation between the two countries in the area of skill development. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.