Financial Daily from THE HINDU group of publications
Monday, Jan 30, 2006
Financial Daily from THE HINDU group of publications Monday, Jan 30, 2006 |
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Industry & Economy
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Power Ratnagiri Gas hits roadblock Our Bureau
Mumbai , Jan. 29 RATNAGIRI Gas and Power Pvt Ltd (RGPPL), the new avatarof the ill-fated Enron's Dabhol Power Company, is still in doldrums. The May 2006 deadline of restarting its plant is very close but neither the fuel nor the fuel linkages are in place. It's a desperate situation and Mr Prithviraj Chavan, Minister of State in the Prime Minister's Office, left for Oman on Friday to tie up `spot contracts' for gas purchase. Moreover, the RGPPL jetty still does not have enough draft to dock gas tankers. Addressing a press conference prior to his departure, Mr Chavan said he was hopeful of sourcing gas from Oman. The Union Power Secretary, Mr R.V. Shahi, has already done the groundwork for his visit. He said the Ratnagiri project would initially require 0.7 million tonnes of gas per annum (mtpa), but the requirement would increase to 2.1 mtpa by November 2006, when the plant is expected to run at full capacity. "It is very important for us to run the plant, as we have invested over Rs 10,000 crore into the project. If gas is not tied up, then we will run the plant on liquid fuel (naphtha), but running the plant on liquid fuel would be very expensive," Mr Chavan said. When questioned by newspersons about the RGPPL jetty's viability in docking a large LNG tanker, which needs a draft of 14.5 m, Mr Chavan said he could only comment about the issue when survey reports are submitted after 10 days. Mr Chavan also confirmed that Maharashtra Government was seeking additional concessions in excise from the Union Government for naphtha. Mr Shahi said that naphtha would be used only during peak demand and not on a 24-hour fuel cycle. An industry analyst told Business Line that spot contracts are very unlikely, as India does not have a strong working relationship, especially in the oil and natural gas sector with Oman. Besides,naphtha would be 40 per cent more expensive than gas.
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