Mumbai: A major new trade involving the shipment of 3m tones of LNG a year between Nigeria and India could be established if a draft agreement between the West African nation and India's National Thermal Power Corporation (NTPC) is finalised within the next three months. NTPC is currently evaluating a draft memorandum of understanding (MoU) from the Nigerian Government allocating it proven onshore gas blocks and other gas resources in exchange for its establishing a 500-MW coal-fired power plant and a 700-MW gas-fired plant in the West African country. According to India's Economic Times, the deal could involve an investment of more than $1.7bn.
The deal is significant because, if signed, it will absorb LNG shipping capacity in a market that is likely to remain oversupplied with tonnage for several years. But, importantly, it will also go some way to alleviating a growing shortage of energy in India. NTPC has been forced to postpone plans for new power plants because of a shortage of gas. Instead it has been forced to buy expensive supplies on the spot market.
In a separate development, the Confederation of Indian Industry (CII) reports that the Indian economy can average 9.5% growth over the next five years, corresponding to the Eleventh Five Year Plan period, provided that a capital investment of $1.5 trillion is made over that period. The CII predicts double-digit growth in the fifth and final year of the period. [09/01/07]
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