Russian gas exporter Gazprom, having just signed a trio of deals in India that could be worth over $90-billion (U.S.), now has it sights on the markets of Europe and North America, a source close to the company said on Thursday.
Similar deals are expected to be reached in the near future with a view to selling liquid natural gas (LNG) in both markets, the source said.
"In Europe, Gazprom is looking into France and Spain," he said.
Gazprom on Wednesday signed memorandums of understanding to supply three Indian customers with an additional 7.5 million tonnes of LNG per year.
The deals could be worth more than $90-billion based on market prices of $10 per million British thermal units.
Gazprom said its Gazprom Marketing and Trading Singapore (GM&TS) was the agent in MOUs signed with GAIL, Gujarat State Petroleum Company (GSPC) and Petronet LNG Limited.
"GM&TS will provide LNG to its Indian partners from its current and projected Gazprom production, such as Sakhalin, and will be supplemented by its wider Russian and international supply portfolio," Gazprom said in a statement.
The source said that Gazprom is set to boost its LNG deliveries to India starting from 2016-2018.
The gas is expected to come from Gazprom's new projects, including Shtokman in the Barents Sea, increased capacity planned at its existing plant on the Pacific island of Sakhalin and from volumes bought from third parties.
"By itself, I don't think it is able to tighten the European market as Russia still has a lot of spare capacity and is not a LNG supplier to Europe today. Pipe gas to Europe will continue to be their main exports," said Emmanuel Fages, head of power, gas, carbon and coal research at Societe Generale Commodities and orbeo.
"Despite the buzz about the Japanese impact on Qatar spare capacity, I think Qatar still has room and can continue being one of the main LNG suppliers to Europe. Then Australia will also kick in, adding slack."
India is seeking overseas energy deals to help cushion against global price fluctuations and to secure energy supply for a country that relies on imports for two-thirds of its oil.
Its gas demand could double by 2020 as the economy expands by around 8 per cent a year and as LNG is looked to as an alternative to carbon-heavy oil and coal.
The annual volume covered by the Indian deals is equivalent to the projected annual LNG output of Shtokman, a Gazprom-led venture with France's Total and Statoil as partners.
LNG from Shtokman is scheduled to come on stream in 2017 though the project still lacks a final investment decision and construction has yet to start in earnest.