Business Daily from THE HINDU group of publications
Monday, Jan 14, 2008
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Business Daily from THE HINDU group of publications Monday, Jan 14, 2008 ePaper | Mobile/PDA Version |
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Petroleum Corporate - Alliances & Joint Ventures
GAIL will get an additional 3-4 million mmscmd of gas The C-Series marginal field is viable only at market-related price ONGC is investing about Rs 3,195 crore in developing this field. Richa Mishra New Delhi, Jan. 13 GAIL (India) Ltd and ONGC are working out a commercial arrangement to market gas from the latter’s marginal field in Mumbai offshore. GAIL expects to get an additional 3-4 million standard cubic metre per day (mmscmd) of gas at a market-related price. A senior ONGC official told Business Line, “Discussions are on with GAIL for marketing 3.2 mmscmd of gas from C-series field. The gas will be made available to GAIL at a market-related price.” The market price normally depends on demand, industry sources said, adding that at present the market-related price was around $4.75 per mBtu. The market price is at least 40-45 per cent higher than the administered price decided by the Government. Since 2006-07, GAIL has been getting 4.8 mmscmd of gas from Panna-Mukta-Tapti field — produced by the joint venture between Reliance Industries Ltd, ONGC and BG — at $4.75 per mBtu. However, from the next financial year, GAIL will get the entire PMT output of 17 mmscmd at a higher price ($5.7 per mBtu). “This gas from ONGC would help GAIL partially meet the deficit in demand and enhance the revenue of GAIL,” Mr U.D. Choubey, GAIL Chairman and Managing Director, said. At present, gas demand in the country is about 150-160 mmscmd, while supply is about 96-100 mmscmd. The gas from C-series field, located 60 km west of Daman in the Tapti Daman block of Mumbai offshore, will be available post-monsoon (October-November) this year. The fields are estimated to hold in-place reserves of 15.54 billion cubic metre of gas and 4.46 mcm of condensate. The development of the first phase is expected to be completed by December 2008. The estimated gas production from the field is more than 3 mmscmd. Though the field was discovered in the 1990s it became viable only recently due to market-determined prices for natural gas, ONGC had said in August 2006. ONGC is investing about Rs 3,195 crore on developing this field. JV approachPreliminary talks on the issue have already been held between the GAIL CMD, Mr Choubey, and the ONGC CMD, Mr R.S. Sharma. GAIL and ONGC have agreed on a joint-venture approach for monetising the gas reserves discovered by ONGC in Krishna Godavari and Mahanadi basins. The joint-venture approach will enable production, processing, transportation, distribution and marketing of gas from new sources to identified markets. It will synergise the production, transportation and distribution strengths of ONGC and GAIL. The two companies had decided to set up a joint working group to work out a suitable action plan and for implementing the same. More Stories on : Petroleum | Alliances & Joint Ventures | GAIL (India) Ltd | Oil & Natural Gas Corporation Ltd
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