SAM, A&O Shearman act on IndianOil - ADNOC 1.2 MMTPA LNG deal

Shardul Amarchand Mangaldas & Co (SAM) and A&O Shearman acted on IndianOil Corporation Limited entering into a long-term sale and purchase arrangement for LNG with Abu Dhabi Gas Liquefaction Company Limited. (ADNOC)

ADNOC will be supplying 1.2 MMTPA of LNG to IndianOil for a period of 14 years. The deal is valued in the range of $7 billion to $9 billion and was signed on February 12, 2025.

SAM advised Indian Oil on the deal. The transaction team consisted of V.R. Neelakantan (Partner), Prashant Sirohi (Partner) and Siddharth Jain (Associate).

A&O Sherman advised ADNOC on this transaction.

This deal marks the first long-term LNG import contract between an Indian company and ADNOC. Deliveries are scheduled to commence in 2026, with LNG sourced from ADNOC's facilities on Das Island, which has a production capacity of up to 6 mmtpa.

This agreement is crucial for India as it seeks to raise the share of natural gas in its energy mix to 15% by 2030, compared to the current 6.2%. Additionally, the deal benefits from the UAE-India Comprehensive Economic Partnership Agreement (CEPA), which waives the 2.5% import duty on LNG, making the imports more cost-effective.

ADNOC Gas is a key player in the global LNG market, known for its extensive natural gas infrastructure and its plans to expand through the upcoming Ruwais LNG project, which is expected to commence operations by the end of 2028. IndianOil, on the other hand, plays a pivotal role in India's energy sector, with a strong presence in refining, pipeline transportation, and marketing of petroleum products.

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