Oil ministry allocates 7.23 mmscmd of ONGC gas to power, fertiliser units

ONGC will produce a total of 0.63 mmscmd of gas from the KG Basin and the remaining 6.605 mmscmd is envisaged to come from western offshore fields like the C-Series, Bandra Formation, North Tapti and Vasai East fields

New Delhi: The oil ministry has allocated 7.23 million metric standard cubic metres per day (mmscmd) of natural gas from state-owned Oil and Natural Gas Corporation’s (ONGC) fields to power and fertiliser firms, including Reliance Infrastructure, NTPC and National Fertilisers, reports PTI.

“The ministry has issued orders for allocating the gas ONGC plans to produce from nominated fields on the West and the East Coast,” a top official said.

“In all, 19 units have been allocated natural gas,” he said.

Reliance Infra’s Samalkot plant in Andhra Pradesh, which gets 0.25 mmscmd of gas from Reliance Industries’ eastern offshore KG-D6 fields, has been allocated 0.03 mmscmd of gas from ONGC’s Krishna-Godavari Basin fields.

Lanco’s Kondapali plant has been allocated 0.11 mmscmd, while Spectrum Power will get 0.29 mmscmd from ONGC’s fields. GVK Industries has been allocated 0.2 mmscmd.

The official said ONGC will produce a total of 0.63 mmscmd of gas from the KG Basin and the remaining 6.605 mmscmd is envisaged to come from western offshore fields like the C-Series, Bandra Formation, North Tapti and Vasai East fields.

The gas from fields off the west coast will be priced at $5.25 per million metric British thermal units (mmBtu) and the same from the Krishna-Godavari basin, off the Andhra Pradesh coast, at $4.75 per mmBtu.

This is more than the $4.205 per mmBtu that Reliance Industries charges for its KG-D6 gas.

“The price applicable is the rate the government had approved in June last year for the gas that ONGC would produce from new fields,” he said, adding that the gas will be sold by state gas utility GAIL India.

Of the gas ONGC will produce from western offshore fields, NFL’s Vijaypur plant in Uttar Pradesh has been allocated 0.73 mmscmd, while IFFCO’s Kalol and Aonla units will get 0.097 mmscmd and 0.36 mmscmd, respectively. Tata Chemical’s Babrala plant has been given 0.08 mmscmd.

State-owned power utility NTPC has been allocated 0.82 mmscmd for its plants in North India, while the Bawana unit in the national capital has been given 1.564 mmscmd. In addition, Indraprastha Power has been allocated 0.23 mmscmd and Ratnagiri Gas and Power Pvt Ltd has been allocated 0.9 mmscmd for its plant at Dabhol, in Maharashtra.

GFSC’s urea-making plant at Baroda (0.2 mmscmd), KSFL’s Sahajahanpur unit (0.204 mmscmd), Rashtriya Chemicals and Fertiliser’s Thal plant (0.45 mmscmd), Kribhco’s Hazira unit (0.8 mmscmd) and GNFC’s Bharuch plant (0.1 mmscmd) have also been allocated ONGC gas.

“Contracted liquefied natural gas (LNG), if any, being used by these customers from GAIL cannot be surrendered citing this allocation to ensure there is no loss to GAIL,” he said.

ONGC is ready to begin production from its C-Series and KG Basin fields and output from the other fields will commence later this year.

The official said pricing of the gas from the east and west coast fields is in line with its 28 June 2010, guidelines, which had set the criteria for fixation of the rates that national oil companies like ONGC can charge for the fuel they produce from new fields in blocks given to them on a nomination basis.

According to those guidelines, ONGC will get $5.25 per mmBtu for the gas it produces from new fields in nomination blocks in the western offshore and $5 per mmBtu for gas from the Cauvery Basin. It will get $4.75 per mmBtu for gas from fields in the Krishna-Godavari Basin, off the Andhra Pradesh coast.

The price approved is more than the $3.818 per mmBtu that the government had fixed for gas ONGC produces from its operational fields in blocks given to it on nomination basis.

The price for consumers of this gas, known as APM or government-administered gas, after including royalty, is $4.2 per mmBtu, the official said.

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