Dabhol shifts to local gas from LNG imports

Dabhol shifts to local gas from LNG imports

New Delhi: The biggest power plant, in the country built by US energy firm Enron Corp that collapsed in 2001, on Wednesday switched to using local gas from costlier imported liquefied natural gas (LNG), a senior company official said.

“From today we have started getting 4.5 mmscmd (million cubic metres a day) gas from Reliance," said A.K. Ahuja, managing director of Ratnagiri Gas and Power Pvt Ltd, which owns the facility at Dabhol in the western state of Maharashtra.

The federal government has allocated Dabhol 5.67 mmscmd of gas, produced from Reliance Industries Ltd’s giant gas field in Krishna Godavari basin off the east coast.

Ahuja said Reliance’s gas would cost about $6.2 per million British thermal units (mBtu) against $7.5/mBtu, it was paying for imported LNG.

The plant, which initially used costly naphtha, shifted to LNG in 2007 when the government mandated Petronet to meet the plant’s gas requirements until September 2009.

Ahuja said the plant should be fully commissioned by the end of March when it would need about 8.5 mmscmd gas. The facility is now operating at an annual rate of 950 MW.

“Only three gas turbines are operating ... by end-March all six will be operational and we should be able to produce 1,950 MW," he said.

The power ministry has assured the company that more gas will be arranged for the full-scale operations, which will help narrow India’s electricity deficit, he said.

India’s power shortfall is expected to widen to 12.6% in the current fiscal year ending in March from 11.9% last year.

Ahuja said the LNG terminal near the plant will be commissioned by December. “We have to do silting and dredging," he said.

The terminal with an annual capacity of 5 million tonnes will initially run at 20-30% rate until a breakwater is built.