The state-run monopoly also said it was in discussions with the Gorgon gas joint venture and Woodside Petroleum to secure between five and seven million tonnes of LNG from Australia. It wanted supplies to start from September next year.

GAIL said it also planned to bid for oil and gas exploration and production assets to be sold off in Australia next year. In addition, it was considering investing in an LNG facility with an Australian partner.

"The deadline for the bids is April 2006 and GAIL is looking forward to taking part in the ongoing bidding rounds for oil and gas blocks," the company said.

GAIL said it had discussed these investment plans with Western Australian premier Geoff Gallop, who is currently visiting India.

In another meeting with the premier yesterday, India’s minister for commerce and industry, Kamal Nath, discussed the possibility of setting up a comprehensive economic agreement (CECA) with Australia to include a free trade agreement (FTA) clause. Nath said the agreement could cover trade in goods and services as well as investment.

Nath said the matter would be more formally discussed with Australian deputy prime minister and the minister for foreign trade, Mark Vaille, on the sidelines of a WTO meeting scheduled for next week in Geneva, an official release said.

India imports 70% of its crude oil and is now also importing 5 million tonnes of LNG from Qatar. The country also plans to import the super-cooled fuel from Iran from 2009.

According to government estimates, India’s energy demand is expected to grow 4% per year for the next 20 years. This and the country’s stagnating domestic output has pushed India's government to encourage state energy firms to invest in foreign oil and gas projects.