RIL prices CBM gas at $6 per mBtu, invites bids for sale
RIL has sought bids for the supply of gas to industries as well as city gas distributors for one year beginning April 1, 2021RIL holds two adjacent CBM blocks SP (West) and SP(East) with an area of 995 square kilometers in the first round of CBM block bidding by the government of India in 2001
PremiumMumbai: Reliance Industries Ltd on Wednesday sought bids from buyers for 0.82 million standard cubic meters per day of gas from its Sohagpur coal-bed methane block (west) in Madhya Pradesh, according to a notice inviting offer.
The gas has priced a minimum of $6 at the current oil price.
CBM is natural gas stored or absorbed in coal seams. India, with the world’s fourth-largest proven coal reserves, holds significant potential for CBM exploration and production. CBM gas is similar to natural gas, containing 90-95% methane.
RIL has sought bids for the supply of gas to industries as well as city gas distributors for one year beginning April 1, 2021.
RIL holds two adjacent CBM blocks SP (West) and SP(East) with an area of 995 square kilometers in the first round of CBM block bidding by the government of India in 2001.
"RIL invites offers from interested companies in accordance with the terms and conditions of the request for proposal (RFP) dated 23 February. The prospective bidders are requested to download the RFP and follow instructions," said RIL in its notice inviting offer.
Users have been asked to quote a percentage of Brent crude oil price they will be willing to pay for the gas. RIL on its part has set 9.5% of Brent rate as the base or minimum price and asked bidders to quote higher than or equal to it.
"The gas produced from the block will be available for sale at the delivery point located at GGS !!, Tehsil Burhar, Sahdol, Madhya Pradesh from 1 April, 2021 subject to the terms of the gas sale and purchase agreement," RIL said in the notice.
RIL has appointed Crisil to help in price discovery process.
Reliance Gas Pipelines Limited (RGPL) a wholly owned subsidiary of RIL, laid a 302 km Shahdol Phulpur Gas Pipeline that connects Sohagpur CBM fields from Shahdol to Hazira-Vijaipur-Jagdishpur (HBJ) pipeline Network of GAIL at Phulpur, connecting the pipeline with the Indian Gas Grid.
"Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!" Click here!
