Tellurian signs $7.5bn LNG deal with Petronet

Jack Unwin 23 September 2019 (Last Updated September 23rd, 2019 12:50)

Indian liquid natural gas company Petronet has signed an agreement with Texas-based Tellurian to acquire an 18% equity stake in its proposed Driftwood LNG facility in Louisiana.

Tellurian signs $7.5bn LNG deal with Petronet
The deal between Tellurian and Petronet was witnessed by PM Modi, whilst President Trymp spoke of it during his speech at the Texas India Forum. Credit: The White House

Indian liquid natural gas company Petronet has signed an agreement with Texas-based Tellurian to acquire an 18% equity stake in its proposed Driftwood LNG facility in Louisiana.

The agreement is valued at $7.5bn, with $2.5bn of that going towards the equity stake. Tellurian has also signed a memorandum of understanding (MoU) with Petronet for the sale of five million tonnes of LNG per year from Driftwood.

The MoU was signed in Houston on 21 September in the presence of Indian Prime Minister Narendra Modi, who tweeted: “It is impossible to come to Houston and not talk energy!

“Had a wonderful interaction with leading energy sector CEOs. We discussed methods to harness opportunities in the energy sector. I also witnessed the signing of MoU between Tellurian and Petronet LNG.”

Once the MoU has undergone due diligence and received approval from Tellurian’s board of directors, the companies expect to complete the deal by 31 March 2020.

Tellurian CEO Meg Gentle said: “Petronet, India’s largest LNG importer, will be able to deliver clean, low-cost, and reliable natural gas to India from Driftwood. Increasing natural gas use will enable India to fuel its impressive economic to achieve Prime Minister Modi’s goal of a $5tn economy while contributing to a cleaner environment.

“It is an honour to sign the MoU with Petronet in the presence of PM Modi. At Tellurian, we look forward to a long and prosperous partnership with Petronet in the Driftwood project.”

The deal was welcomed by US President Donald Trump at the Howdy Modi Community Summit in front of 50,000 people at the NRG Stadium in Houston.

Speaking alongside PM Modi, Trump said: “Yesterday we were thrilled to hear about the Petronet pledge to purchase up to five million tonnes of LNG per year from the US which could lead to billions of dollars of LNG exports to India in the coming years, and we have plenty of it.”

Tellurian thanked the two leaders, tweeting: “Tellurian is ready to partner Petronet to provide US LNG to India. Thank you President Trump and PM Modi.”

Shares in Tellurian have risen slightly from $8.58 to $8.68 a share on the NASDAQ, a growth of over 1% and the company’s market capitalisation is $2.1bn. This is above the $7.11 a share at the start of 2019 but down on its peak share price of $11.24 on 27 March.

Tellurian share price in 2019


Petronet’s share price dropped by over 5% from Rs266.45 to Rs251.90 on the National Stock Exchange of India (NSE), giving it a market capitalisation value of Rs377.9bn. Despite the drop, Petronet’s stock price has generally been on the rise throughout 2019, starting the year on Rs299 a share.