On Monday, February 19, Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPCL), an Indian multinational company, has announced a new long-term supply agreement for liquefied natural gas (LNG) with Equinor, a global energy company based in Norway.
Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL) is an Indian multinational company with a diversified portfolio in chemicals, fertilizers, and other agricultural products. Established in 1979, DFPCL has grown to become a prominent player in the Indian agricultural industry, offering a range of fertilizers, industrial chemicals, and technical ammonium nitrate.
Equinor, formerly known as Statoil, is a Norwegian multinational energy company with operations in over 30 countries worldwide. Established in 1972, Equinor is one of the largest producers of oil and gas in Europe. The company is also a leader in renewable energy, with a growing portfolio of wind and solar projects. Equinor is known for its commitment to sustainability and has set ambitious targets to reduce its carbon footprint.
Deepak Fertilisers has enhanced its value chain by securing a long-term LNG contract, as disclosed in a stock exchange filing. This agreement strengthens their position from gas to ammonia, as well as downstream fertilisers, industrial chemicals, and mining chemicals. Equinor, previously known as Statoil, is a prominent global player in the oil and gas industry, boasting over 50 years of experience and a market capitalization of $75 billion.
The Norwegian government holds the majority stake in Equinor. The agreement between Equinor’s Executive Vice President, Irene Rummelhoff, and DFPCL’s Chairman and Managing Director, Sailesh C. Mehta, stands out as one of Equinor’s most significant contracts with a private sector entity in India. Under this agreement, Equinor will supply up to 0.65 million tonnes of LNG annually for 15 years, starting in 2026.
This partnership allows for the trading of LNG parcels to meet India’s growing demand for LNG and to fulfill DFPCL’s increasing captive needs. The LNG shipments will be directed to the west coast of India. DFPCL has made significant progress in securing the re-gasification terminal, with gas pipeline connectivity to its plant’s doorstep already established.
Sailesh C. Mehta, Chairman and Managing Director of DFPCL, stated, “This will establish a strong foundation for Deepak Fertilisers’ value chain, spanning from gas and ammonia to nitric acids, downstream fertilisers, mining chemicals, and industrial chemicals. This collaboration will not only help the company manage global market fluctuations but also improve its overall margins.”
Equinor’s Gas & Power Senior Vice President, Helge Haugane, emphasized the importance of ammonia as a fundamental element for society, particularly vital for agriculture and food security. He expressed pride in Equinor’s role in supplying natural gas as feedstock for Deepak’s new ammonia plant, which will contribute to India’s domestic fertilizer supply. Haugane also expressed enthusiasm for advancing the partnership with Deepak, focusing on feedstocks and low-carbon projects in the coming years.
