Menezes underscored that the technological advances from the shale boom have not only helped the US become the world’s largest producer of oil and gas but have also given nations like India the opportunity to secure energy supplies from a new, reliable source.
With the development of export terminals and a growing infrastructure to ship liquefied natural gas (LNG), the US has emerged as a key partner for energy-hungry nations. This shift is particularly important for India, which now has the option to diversify its energy imports and reduce dependence on historically unstable regions, Menezes said.Below is the verbatim transcript of the interview.
Q: What do you expect to be on the table when the two leaders meet, especially in terms of India buying more energy from the US?
Menezes: First of all, thank you very much for having me and a chance to really talk about really this new dynamism that we will see between President Trump and Modi in the upcoming meetings. And it’s going to be a building on a long-term relationship. I mean, these two men have a genuine fondness for one another.If we go back to Trump 1.0, where President Trump and Modi, they took the initiative then to establish a strategic energy partnership, which was comprehensive in scope, by the way. And at the time, you will remember, the US was just really beginning to export LNG. We had been able to develop the facilities to export, and India was one of the first locations that US LNG went. What was interesting was that these LNG facilities that we had been developing were expected to go to other parts of Asia, not so much India. So, it was really a dynamic surprise to see that we could help our partners, India, and provide that. So, I would expect you to see sort of a continuation of that, really, an acknowledgement of our past relationship.
The importance of India in the region, the importance that energy plays in maintaining global security and economic prosperity, but importantly, too, India is going to need energy long term. It is one of the great countries that continue to increase population. Your current population needs energy. And whether it’s US LNG, whether it’s US technology in nuclear space, whether it’s the latest technology on natural gas turbines or how it is that you can build more renewables with natural gas really to bring energy of all sorts to India. So that’s what we’re excited about here in the upcoming meetings.
Q: Do you expect the US government to demand that India have more long-term LNG contracts and long-term crude oil contracts with the US companies?
Menezes: I mean, that’s the hope. We want a long-term relationship and India knows it well because you have facilities operating there, whether it’s refineries or import facilities, these are high capital facilities, and so you need long-term offtake agreements.
And it is important that, our partners across the world realise that your options for energy are well known. And US has not necessarily been there for partnership until the shale revolution. And it turns out that due to technological improvements, we got our policies in order to allow states to allow franking, if you will.
We really became the world’s largest producer of both oil and natural gas. So now countries like India before who you had to pay a premium for Mideast oil or Mideast natural gas or deal with other countries that you really had no choice as to who you were going to deal with, well, now the US is available as a partner. And I think that generally to have optionality, it’s good for US economy, good for business, good for long-term relationships, but it’s also good for pricing for the Indian consumers, because now you can either have long-term contracts, but you also have the option for spot markets.
We talked about this back during Trump 1.0, the natural gas global market has really evolved at the level almost like the oil market where prices in the US, prices in India are set by the global price of where these commodities are traded. And now we’re seeing that with natural gas. So, the consumers in India can benefit with more suppliers, more optionality. It’s going to decrease prices and it’ll benefit our partnership.
