New Delhi: In an attempt to meet India’s energy requirements, Gas Authority of India Limited (Gail) on Sunday signed an agreement to buy Liquefied Natural Gas (LNG) from a US firm.

Under the signed agreement, the company would buy 35 lakh tonnes LNG a year from the US firm in a period of 20 years.

This agreement is said to be very crucial in the petroleum sector.

As per the information provided by GAIL, it will buy LNG from Sabine Pass Liquefaction. The agreement was signed for 20 years and there is also an extension option of up to 10 years.

BC Tripathi, CMD, GAIL said, “This agreement will meet the needs of gas in Indian market and by 2016 it will fulfill the supply of LNG.”

This is the second major step taken by GAIL in the sector with America. Few days back, the company purchased a shell gas block there.

The company has also opened an office in Houston to keep an eye on this agreement.

Experts believed that due to the instability in Gulf Countries, companies are hesitating in signing long-term agreements.

At present, GAIL has 9,000 km gas pipeline of its gas grid projects. The company would add 5,000 km gas pipelines by 2014.

This network will meet the domestic requirements. And this is the only reason why the company is looking to buy gas from other countries.

GAIL has also set up another company in Singapore only to buy gas from other countries.

(JPN/Bureau)