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US natural gas company Tellurian and India's largest LNG importer Petronet LNG Ltd (PLL) have signed an MoU under which the latter and its affiliates will import up to 5 million tonnes of LNG from America.
The deal signed on Saturday will also include PLL's equity investment in Tellurian's Driftwood project after further negotiations on the terms and size of the equity deal. The Driftwood project includes natural gas production, gathering, processing, and transportation facilities, along with a proposed 27.6 mtpa liquefaction export facility.
The announcement came after Prime Minister Narendra Modi had a meeting with the CEOs of top oil companies based in the US on Saturday.
A statement from Tellurian said the Memorandum of Understanding (MoU) was signed in Modi's presence.
"Petronet, India's largest LNG importer, will be able to deliver clean, low-cost, and reliable natural gas to India from Driftwood. Increasing natural gas use will enable India to fuel its impressive economic growth to achieve Prime Minister Modi's goal of a $5 trillion economy while contributing to a cleaner environment," Tellurian's President and CEO Meg Gentle said in a statement.
"It is an honour to sign the MOU with Petronet in the presence of Modi. At Tellurian, we look forward to a long and prosperous partnership with Petronet in the Driftwood project," she added.
The deal on LNG is subject to further negotiations. Tellurian and Petronet will endeavour to finalize the transaction agreements by March 31, 2020.
Petronet is the largest importer of LNG in India with a market capitalization of approximately $5.1 billion. Petronet developed the country's first LNG receiving and regasification terminal at Dahej, Gujarat (17.5 mtpa), and another terminal at Kochi, Kerala (5 mtpa).
Modi's meeting with energy sector CEOs was scheduled as the first event of his week-long US visit. The meeting focused on working together for energy security and expanding mutual investment opportunities between India and the US.
"Getting straight to business. PM @narendramodi just concluded a fruitful interaction with top energy sector CEOs at a Roundtable meeting in #Houston. Discussion focussed on working together for energy security and expanding mutual investment opportunities between India and US," External Affairs Ministry spokesman Raveesh Kumar said in a tweet after the meeting.
"Further energising India-US friendship. Among the first engagements of PM @narendramodi in Houston is a meeting with CEOs from the energy sector. India and the US are looking to diversify cooperation in this sector," the Prime Minister's Office also posted on Twitter.
Modi is scheduled to address over 50,000 Indian-Americans at the "Howdy Modi!" event on Sunday, in which he will be joined by US President Donald Trump.
The event at the sprawling NRG football stadium here will be the largest gathering ever for an elected foreign leader visiting the US, other than the Pope.