Government asks Reliance to sell gas to Ratnagiri

Government asks Reliance to sell gas to Ratnagiri

Mumbai: India’s biggest company by market value, Reliance Industries Ltd, has been asked by the government to supply natural gas to Ratnagiri Gas and Power Pvt. Ltd on priority to help ease electricity shortages in Maharashtra.

The price at which Reliance can sell natural gas from its largest field to all its customers was fixed at $4.2 (Rs209) per million British thermal units for crude oil equal to or more than $60 a barrel, the ministry of petroleum and natural gas said in an emailed statement on Thursday.

India’s domestic gas supplies are inadequate to meet surging demand from fertilizer and power companies for the cleaner-burning fuel.

A group of ministers agreed in May that fertilizer makers would get first priority in the supply of gas from Reliance’s offshore field, which is expected to produce 40 million cu. m a day by March.

The ministry has now included the 2,144MW Ratnagiri project, operated by GAIL (India) Ltd and NTPC Ltd, in the priority list along with the fertilizer companies.

The Ratnagiri plant will be entitled to supplies of 1.4 million cu. m of gas a day from January to March, 2.7 million cu. m from April to September and 8.5 million cu. m after September, according to the ministry.

Electricity generators in Andhra Pradesh, which is closest to Reliance’s D6 area in the Krishna-Godavari field, will also get priority, the government said.

These plants, along with Ratnagiri, will get as much as 18 million cu. m of natural gas a day. The ministry said it will wait for a court verdict to decide on the price of gas to be sold to NTPC, India’s biggest power producer.