Qatar has agreed to supply an additional 4 million metric tons of liquefied natural gas a year to India by 2014 to meet its rising energy consumption, petroleum secretary S Sundareshan told newspersons in New Delhi on Saturday. Prices however have not been finalised.

The fuel may be supplied to Petronet LNG Ltd's terminal at Kochi and a terminal being built by Ratnagiri Gas & Power Pvt Ltd at Dabhol, Sundareshan said. Ratnagiri is controlled by GAIL India Ltd and the National Thermal Power Corp Ltd.

Qatar, the world's largest LNG exporter, will begin with one million tonnes of supplies in 2011 and ramp it up to 4 million tonnes by 2014. "These will be 15-20 year contracts," Qatar's energy minister Abdullah al-Attiyah told reporters after an hour-long meeting with petroleum minister Murli Deora.

"India is on top of my agenda. We are always committed to meeting India's needs," he said.

India currently imports 7.5 million tons of LNG every year from Qatar's RasGas under a long-term deal. The additional fuel would be imported at Petronet LNG Ltd's under-construction Kochi LNG terminal and almost ready Dabhol receiving facility on the western coast.

Qatar is seeking to sell its surplus LNG elsewhere after its principal importers, the US and Europe, cut imports. ''We are looking to divert conditional cargoes from the US and Europe to India if we get better deals,'' al-Attiyah said.

''The volumes have been agreed,'' Sundareshan said. ''Pricing has to be agreed to now and Rasgas is discussing that with Petronet and GAIL.''

The latest agreement is for India to receive an additional 300,000 tonnes a year in 2010, 500,000 tons in 2011, 2.5 million tons in 2012 and 4 million tonnes by 2014. Petronet LNG currently has contracts to purchase 7.5 million tonnes of the fuel a year until 2028.

Qatar is currently producing 62 million tonnes a year of LNG and may raise its output to 77 million tons by September after two more LNG trains start operations, al-Attiyah said.

However, there is reportedly a feeling among Indian officials that the price demanded by Qatar is too high – though al-Attiyah said Qatar was willing to meet any demand that New Delhi had, adding that "We came to the rescue when India faced shortage (in 2008 and 2009)."

But in this case, it is unlikely to be a 'sweetheart deal' as it was earlier; and there may be hard price negotiations ahead.