India’s Gujarat State Petroleum Corp. has issued JKM-linked tenders for the first time to buy LNG cargoes for delivery into India from April 2027, according to a source with direct knowledge of the matter.
This marks a departure from the fixed-price basis typically used by Indian importers.
One of the tenders seeks two cargoes for delivery in April and September 2027. It closes on October 12 at 3 pm IST, with bids valid for one day. The other seeks one cargo every month from April 2027 to March 2028. It closes on October 13 at 3 pm India time, also with one-day validity.
Sellers are required to quote a discount against the JKM monthly average corresponding to the month of cargo delivery.
Cargoes under both tenders are sized at 3.2 trillion-3.4 trillion British thermal units, each with a 5% operational tolerance, and the seller is to nominate a 10-day delivery window.
The move follows a similar step by Bharat Petroleum Corp. Ltd., which on September 23 issued a spot tender to buy an LNG cargo for delivery between November 21 and 30 at a JKM-linked price, also for the first time. The tender was reportedly awarded on September 24 at JKM December plus 30-35 cents/million British thermal units for a cargo from a country with a free trade agreement with India.
GSPC previously bought three spot cargoes through tenders in August and two in September, all on a fixed-price basis as prices rallied from the low-$20s/MMBtu to near $29/MMBtu.
In addition, GSPC has included a clause allowing the seller to convert the contract price from floating to fixed or vice versa at the buyer’s request.
Indian importers typically purchase spot cargoes on a fixed-price basis, and during previous price hikes, some were exposed to downside risks after securing a cargo. Indian importers were largely cautious about buying spot cargoes amid concentrated arrivals of Middle Eastern supply following several transits out of the Strait of Hormuz, according to multiple importers and traders.
