Pradhan and Seko discuss cooperation in hydrocarbon sector

India and Japan are to cooperate in facilitating flexibility in Liquified Natural Gas (LNG) contracts, being the two leading gas markets.

The two countries have signed a Memorandum of Cooperation (MoC) to work together on the abolition of Destination Restriction Clause and explore possibilities of cooperation in establishing reliable LNG spot price indices reflecting true LNG demand and supply.

This cooperation would also help in promoting bilateral relationship between India and Japan in the LNG sector.

Petroleum and Natural Gas Minister Dharmendra Pradhan and Japan’s Minister of Economy, Trade, and Industry Hiroshige Seko signed the MoC during the former’s visit to Tokyo 17-18 October 2017.

Under the Japan-India Energy Partnership Initiative signed in January 2016, the two sides had agreed to work together in promoting well-functioning energy markets.

The two ministers discussed ongoing cooperation in the hydrocarbon sector between our companies in India and abroad and explored ways to further enhance the engagement.

They also explored joint cooperation in the areas of LNG sourcing, swapping and optimization of LNG sources and commercial exploitation of Methane Hydrates.

Pradhan also participated in LNG Producer-Consumer Conference organized by the Ministry of Economy, Trade and Industry of Japan (METI) and the Asia Pacific Energy Research Centre (APERC).

Delivering the key note address Pradhan pointed out 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 of LNG 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.

Pradhan stressed that these reforms are essential for developing a transparent, efficient, truly global and balanced LNG market. fii-news.com