Regional LNG: India, Qatar to forge partnership to boost LNG supply

India and Qatar said they are planning to forge a strategic partnership to boost two-way investments and the supply of natural gas from the Gulf emirate, the AFX reported on Friday.

Sheikh Hamad bin Khalifa al-Thani, the emir of Qatar, wrapped up three days of talks with Indian leaders including Prime Minister Manmohan Singh which both sides described as "comprehensive and fruitful."

Qatar's Deputy Prime Minister Hamad bin Jassem al-Thani said Doha will next month send a high-powered delegation for further talks with energy-hungry India.

"Although there is a decision on a strategic partnership we are studying it now to see what kind of partnership we can have, because we just don't want to promise something," he told a news conference.

Qatar, which boasts the world's third-largest gas reserves, agreed in 1999 to deliver 7.5 million tons of liquefied natural gas (LNG) to India annually for 25 years.

The first shipments arrived at the start of 2004 in northwestern Gujarat state, which is to take 5 million tons. LNG receiving capacity at Gujarat's Dahej terminal is being doubled to 10 mln tons.

Talks are under way between Qatar's state-run Rasgas and Petronet for a second phase covering 2.5 million tons a year to the southern state of Kerala.

Petronet's chief executive Suresh Mathur said last month the company planned to offer a 10 percent stake to Rasgas in a proposed gas storage terminal in Kerala's Cochin city. State-owned Indian oil companies own half of Petronet with private-sector firms holding the rest.

"We have a commitment of 7.5 million tons of gas (to India) which is huge, but still if there is room to increase production then we will give priority to India," Qatar's deputy premier said.

Indian Petroleum Minister Mani Shankar Iyer underlined that the emir backs a closer partnership in the energy sector.

India wants natural gas to meet 20 percent of its energy needs by 2025, up from about 8 pct today.

Qatar plans to boost LNG production to 60 million tons in 2010 from 18 million tons in 2004.

The deputy premier also said a deal for Doha to sell India 12 of its used French-built Mirage 2000 jets had been finalized, but disclosed no details.

India's air force flies the Dassault Aviation fighters and signed a deal in Sept 2000 to buy 10 new planes to replace aircraft lost out of a 1985 order of 49 Mirages.

India has announced plans to buy 126 jet fighters to bolster its fleet by five squadrons in the next 15 years.

It is considering a number of potential suppliers, including Russia's MiG-29K, Dassault's Mirage-2005/5, the Grippen from Saab, a British-Swedish consortium, and Lockheed Martin's F-16 and F-18.

India and Qatar have also signed a bilateral air services pact to improve connectivity.(*)