Govt asks RIL to allocate natural gas to Dabhol plant

Govt asks RIL to allocate natural gas to Dabhol plant

New Delhi: The government has asked Reliance Industries to supply natural gas from the company’s eastern offshore D6 fields to the beleaguered Dabhol power plant, a segment that gets top preference for gas allocation along with fertiliser units.

Detailing customers for the initial 40 million standard cubic meters per day of gas to be produced from Krishna Godavari basin D6 field, a petroleum ministry statement said that gas to Ratnagiri Gas and Power (Dabhol) will be within the overall allocation of 18 mmscmd for the power sector.

“It has been decided that RGPPL be supplied 1.4 mmscmd during January to March 2009 and 2.7 mmscmd during April to September 2009, subject to commencement of production, within the overall allocation of power sector (18 mmscmd)," it said.

Further, 8.5 mmscmd would be supplied to RGPPL after September 2009.

Reliance is to begin production from its prolific D6 fields lying off the Andhra coast in January 2009 with an initial output of 5 mmscmd. This will rise to 25 mmscmd by March and to 55 mmscmd by July 2009.

The fertiliser sector would continue to get top priority over D6 gas with 14 mmscmd being allocated for existing units.

The statement said D6 gas would be sold to all customers at the rate of $4.2 per million British thermal unit(mmBtu) if crude oil price averaged greater or equal to $60 per barrel in the year preceding the sale.

As per the gas utilisation policy approved by the Empowered Group of Ministers (EGoM), Reliance is to first supply gas to existing gas-based urea plants and then give 3 mmscmd to LPG plants. Thereafter, up to 18 mmscmd of gas was to be given to gas-based power plants that were lying idle/under-utilised or likely to be commissioned during 2008-09.