New Delhi, July 25, 2014: GAIL (India) Limited today announced the signing of a Memorandum of Understanding (MOU) with Sumitomo Corporation, Japan (Sumitomo). Under the MOU, GAIL and Sumitomo will pursue business opportunities in natural gas and LNG value chain business globally, specifically covering cooperation in petrochemicals, natural gas procurement, pipelines and LNG. GAIL and Sumitomo hold half of the capacity in the Cove Point LNG Liquefaction Terminal in the US respectively, and have also agreed to coordinate for ensuring smooth operation of the terminal. Both parties view US market as a growth area for their line of businesses and would cooperate on businesses ranging from upstream to downstream.
Mr. B.C. Tripathi, Chairman and Managing Director of GAIL (India) Limited, stated “This is an important occasion for GAIL and we are happy to enter into this strategic relationship with Sumitomo with whom we are long term partners in Cove Point project. There are significant opportunities in the North American gas markets and we are pleased to be partnering with Sumitomo in jointly developing this business.”
GAIL is India’s leading natural gas company with a presence along the entire hydrocarbon value chain spanning E&P, LNG, pipelines, LPG, petrochemicals, city gas distribution, etc. In USA, GAIL has a wholly owned subsidiary, GAIL Global (USA) Inc, which has acquired stake in Eagle Ford shale acreage. Further GAIL has long term LNG contracts with Sabine Pass and Cove Point terminal for import of 5.8 MMTPA of LNG .
Sumitomo is one of the world’s leading fully integrated trading and investing enterprises headquartered in Tokyo, Japan. Besides its role as an international trader, Sumitomo is an active investor in a diverse range of businesses such as metal, mineral resources, energy, chemical, etc. Sumitomo’s subsidiary, Pacific Summit Energy LLC, is a significant player in natural gas trading and marketing (physical and financial) in USA. Sumitomo has also invested in shale gas/tight oil assets in USA.