BG Group Plc, the U.K.’s third-largest natural gas-producer, agreed to a long-term sale of liquefied natural gas to India.
BG will supply state-owned Gujarat State Petroleum Corp. with as much as 2.5 million tons a year of LNG, the Reading, U.K.-based company said today in a statement. BG will initially sell 1.25 million tons a year in 2015, and the contract will run for up to 20 years, it said.
India, one of the world’s fastest-growing large economies, consumes almost 35 percent more gas than it produces, according to the U.S. Energy Information Administration. Asian prices for LNG currently trade at about $16.79 per million British Thermal Units, compared with as low as $3.49 in the U.S, according to data from Poten & Partners.
“We have been active in India for more than 15 years and it is a large and important market that we understand well,” BG Chief Executive Officer Chris Finlayson said. “We expect the country to lie third among LNG importing countries by 2025, behind Japan and China.”