As India positions itself as one of the fastest-growing global investment destinations, companies and investors want stability in returns. Offtake agreements, long-term purchase contracts, assure suppliers their output will be sold and give buyers a steady supply at predictable prices. They matter most in capital-intensive sectors such as chemicals, petrochemicals, oil and gas, and renewables, where a single plant can cost billions of dollars.
How Offtake Agreements Shape Industries
As countries race to decouple their supply chains from dominant single-source suppliers, offtake agreements have become primary tools for economic security.
| Field | Recent agreements (2024 onwards) |
| Gas / LNG | ADNOC's Ruwais LNG: 1 mtpa of LNG supply to Japan's INPEX for 15 years under a newly signed agreement [1]. Over 90% of 9.6 mtpa is now contracted before the 2028 start-up [1] |
| Green methanol | Hapag-Lloyd and Goldwind: 250,000 tonnes a year (December 2024) [2]. |
| Critical minerals | Serra Verde, Brazil: 15-year take-or-pay offtake with the US Government for 100% of Phase I output of four magnetic rare earths (terbium, dysprosium, neodymium, praseodymium), with price floors (finalised August 2026) [3]. |
| Recycled polyester | H&M Group's USD 600 million, seven-year offtake agreement with Syre shifts its polyester supply from bottle-based recycled PET (rPET) to true textile-to-textile recycling (March 2024) [4]. |
Offtake contracts have spread from LNG to hydrogen derivatives, critical minerals, fertilisers, recycled materials and carbon removal. Tenures typically run 5 to 15 years, often signed years before the first delivery, and some critical-minerals contracts carry government backing.
Growing Momentum in India
India is now converting memoranda into binding contracts. On 16 March 2026, Reliance Industries signed a 15-year agreement with Samsung C&T for green ammonia, starting in the second half of FY2029. Valued at over US$3 billion, or about US$200 million a year, it is among the largest binding green ammonia offtake agreements globally [5]. In January 2026, Uniper, Germany agreed to take up to 500,000 tonnes a year from AM Green, with first shipments as early as 2028 from its first 1 MTPA plant at Kakinada, Andhra Pradesh [6].
The latest milestone: AM Green was chosen sole winner of the Asian lot in the H2Global auction run by HINT.CO. Hintco will buy ammonia for 10 years at a minimum value of €585 million, with an option to buy more using resale proceeds in Europe. The ammonia will come from Kakinada Phase 2, an existing gas-based ammonia and urea complex being converted to alkaline electrolysis, using round-the-clock renewable power backed by pumped-hydro storage to meet EU requirements. First deliveries to Germany are expected in 2029 from Kakinada Seaports [7].
Publicly announced contracts now span up to 1.2 million tonnes a year of renewable ammonia and 100,000 tonnes a year of green methanol [8]. SECI's SIGHT auctions cover 724,000 tonnes a year for fertiliser plants at 10-year fixed prices of ₹49.75–64.74/kg [9]. The lowest bid is about 12% above grey ammonia [10], and far below the US$1,153 a tonne seen in the first H2Global round [11].
Of the 16 agreements profiled above, green ammonia accounts for 50%, green methanol and gas 12.5% each, and fertilisers, critical minerals, recycled polyester and carbon removal 6.25% each. This indicative tally mirrors the IEA's finding that only one-fifth of 1.7 Mtpa of new low-emissions hydrogen offtake in 2025 was firm [21].
| Buyer / Offtaker | Supplier | Field | Quantity / terms | Year |
| Kyushu Electric, Sojitz | Sembcorp | Green ammonia | 200 kt/yr initial; Heads of Terms [12] | 2024 |
| BASF | AM Green | Green ammonia | 100 kt/yr [13] | 2024 |
| IndianOil | ADNOC | Gas / LNG | 1 mtpa, 15-year Heads of Agreement [14] | 2024 |
| Paradeep Phosphates | ACME | Green ammonia | 75 kt/yr at ₹55.75/kg, 10 yrs [15] | 2025 |
| Krishana Phoschem | NTPC REL | Green ammonia | 70 kt/yr at ₹51.80/kg, 10 yrs [16] | 2025 |
| IPL, KRIBHCO, Coromandel | Ma'aden | Fertilisers | 3.1 Mt/yr DAP, 5 yrs plus 5 [17] | 2025 |
| Varaha | Carbon removal | 100,000 t credits by 2030 [18] | 2025 | |
| Uniper | AM Green | Green ammonia | Up to 500 kt/yr [6] | 2026 |
| Samsung C&T | Reliance | Green ammonia | 15 yrs, over US$3 bn [5] | 2026 |
| IHI | ACME | Green ammonia | 405 kt/yr [19] | 2026 |
| Hintco (H2Global) | AM Green | Green ammonia | 10 yrs, minimum €585 m [7] | 2026 |
| Mitsubishi Gas Chemical | ACME | Green methanol | 100 kt/yr, 10 yrs [20] | 2026 |
Creating a Favourable Environment for Offtake Agreements in India
Offtake insurance would protect buyers against supply disruption or counterparty default. Standardised Heads of Terms would reduce disputes and build trust. India also needs more project-finance and risk professionals who can design bankable contracts. Finally, policy support works: SIGHT's ₹15.3 billion incentive pool [15] and Japan's price support for buyers [19] make deals viable in emerging sectors such as hydrogen.
Agreements can also fail. SECI cancelled two offshore wind tenders in 2025 for lack of developer interest [22], and BEST sought to drop its thermal power purchase from Tata Power when energy charges reached ₹8–11 a unit, until the regulator directed it to continue [23]. The remedy is practical: well-designed tenders, realistic tariffs, a few anchor buyers early, and flexible clauses for changing market or policy conditions.
India Market Perspective
India is emerging as a credible supplier of green molecules, with up to 1.2 million tonnes a year of ammonia contracts announced and 724,000 tonnes a year locked in through domestic auctions. In the near term, binding offtake lets developers reach financial close, pulling investment into electrolysers, renewable power, ports and shipping, while giving global buyers certified supply from 2028–29 and fertiliser makers price certainty.
Conclusion
Offtake agreements can catalyse industrial growth, cross-border investment and decarbonisation. For refineries, steelmakers and chemical producers, they secure raw materials at predictable costs, reduce developer risk, speed up downstream industries and support net-zero goals. Risks such as price swings, counterparty default and policy change can be managed through indexed pricing, credit support and change-in-law clauses. Overall, offtake agreements secure predictable revenues for high-cost global projects, reducing market uncertainty and attracting international capital.
This blog is written by Aboli Arun Mandurnekar
