India to buy Rs 2,000 crore of US shale gas, a move likely to be welcomed by US president
New Delhi, Aug 13 (PTI) The Indian government on Monday announced a Rs 2.5 lakh crore deal with the US shale oil and gas group ExxonMobil to purchase up to 5 billion cubic feet of natural gas in the US from 2018 onwards.
In a move that is likely to attract US President Donald Trump’s approval, India and ExxonMobil have agreed to explore and develop an 890-million-barrel natural gas (NGL) export pipeline in the Gulf of Mexico to transport gas to the US.
The pipeline would run through the Gulf, and be located in the state of New Jersey, where the Indian Ocean coastline has historically been a major oil and natural gas producer.
ExxonMobil has said that the pipeline will supply a significant portion of the gas demand for the Indian oil and oil and chemical industries.
Exchange of viewsIndia and ExxonMobile, the world’s largest wireless carrier, have also agreed to establish a joint venture to invest in the development of a new technology called Xcell technology, a breakthrough in energy storage technology that can store energy in a solid, liquid state.
Exercise of the right to explore, develop and manufacture the Xcell project is subject to a tender process in the form of a tender for exploration and development and a tender to manufacture the device for use in the Xcells’ energy storage.
The tender process is likely soon to be extended to include other technologies, including advanced technology for energy storage, according to a statement by the companies.
Excerpts from ExxonMobil’s press release: Exelco, a global leader in energy and telecommunications services, today announced that ExxonMobil will invest $1.5 billion to build and operate an 895-million barrel natural gas pipeline to connect Indian Gulf of North America with the Gulf Coast of Texas.
Exelco is the largest natural gas exporter in the world, and has a long history of partnering with industry, including oil, gas and power companies.
The company’s recent acquisition of Enbridge, Canada’s largest pipeline operator, is part of an overall strategy to expand its global footprint.
Exelcos pipeline network extends from New York to Texas, with the expansion planned to extend to Texas and Oklahoma.
Excels technology is being used in energy products for electric vehicles and power generation.
The new pipeline is expected to be operational by 2019.
Excellos technology is expected have an operational life of 30 years, with a maximum annual capacity of 1 billion cubic meters.
Exely’s Indian subsidiary is building a gas-to-oil pipeline from Gujarat, India to Pakistan’s Punjab province.
Excellos pipeline network also extends from Gujarat to Pakistan, with an extension to Pakistan planned by 2020.
Expectation of US dealThe US State Department, the Commerce Department and the US Energy Department are expected to announce the deal at the end of the day, which would give ExxonMobil an estimated $2.2 billion in additional annual revenue from the gas and oil exploration, transport and development of the X cells.
Exercises of the tender process have already begun, the companies said.
Exemply, the company said it expects to make the X cell technology commercially viable by the middle of the decade.
Execution of the rights to exploreThe Indian government is expected later this month to grant ExelCo and Exel Mobile exclusive rights to exercise exploration and develop the Xs, Exel Co said in a statement.
The Indian Supreme Court, however, has ordered that the Indian government issue a licence to the company to conduct exploration of the Indian and US waters, which could result in a ban on ExxonMobil from drilling there.
Examining the US-India partnershipExelCo is also looking at the possibility of opening up a joint exploration and production venture in India, which is expected in the second half of 2018.
Exellos subsidiary is already in talks with Exel Mobility for an exploratory drill and exploitation project, according of the company.
Exely and Exellocom, the joint venture that is jointly owned by Exel Corp and Exemply is looking to explore the Indian Gulf and Indian Ocean, the statement said.
Exerce, the Indian subsidiary of Exel, is also exploring the Gulf.
Exellocomm, which owns the Indian gas company and the oil company, has not responded to an email seeking comment.