EGoM gives extra K-G gas to power sector

Written by fe Bureaus | New Delhi | Updated: Oct 28 2009, 08:24am hrs
The empowered group of ministers (eGoM) headed by finance minister Pranab Mukherjee on Tuesday allocated the bulk of the additional natural gas from Reliance Industries K-G D6 fields to the laggard power sector. The sector has been granted two thirds of the additional supplyan assured gas supply of 13 million metric standard cubic metres a day (mmscmd) and another 12 mmscmd on a temporary basis.

Today, the eGoM met to consider allocation of gas beyond 40 mmscmd. It has fixed users for about 50 mmscmd of gas, petroleum secretary RS Pandey said after the meeting. Of this, about 20 mmscmd has been given on a firm basis, while another 30 mmscmd has been granted on a fallback or temporary basis, he said. This 30 mmscmd of gas will only be available if and when the K-G D6 production capacity exceeds the initial output of 40 mmscmd.

Based on technical assessment provided by the operator, production (from K-G D6) will reach 60 mmscmd by December and then is expected to go beyond 80 mmscmd, he said. The eGoM, however, did not take up the issue of marketing margin for the gas allocated from K-G D6.

The eGoM also allocated on a firm basis0.178 mmscmd of gas to the fertiliser sector, 0.44 mmscmd to the steel sector, 1.918 mmscmd to petrochemicals and 5.384 mmscmd to refineries. On a fall back basis, refineries have been given 6 mmscmd of gas while the city gas sector will get 2 mmscmd of gas. Captive power plants will be given 10 mmscmd of gas, although the list of eligible power plants has not been decided.

It is a long list. The ministry of power and the ministry of petroleum will sit together and decide on it, Pandey said. This additional allocation will help meet the entire 42.07 mmscmd fuel deficit that was left at existing power plants even after the allocation of 18 mmscmd from the initial volumes.

RIL has also been allowed to use 1.918 mmscmd from the K-G D6 field for its petrochemicals and refineries business. Earlier eGoM had said allocations to the firm would be considered when output from the K-G Basin exceeded 40 mmscmd. This was the first meeting of the eGoM, which was notified just last Thursday.

Oil ministry undecided on Sibal extension

Four days before the director-general of hydrocarbons Vinod Kumar Sibals tenure comes to an end, the Oil ministry is still mulling over an extension for him. Sibal resigned from his employer Oil India Ltd last Friday even as the Central Vigilance Commission has sought a discreet enquiry into allegations about his close nexus with Reliance Industries Ltd. When asked on Tuesday if Sibals tenure would be extended, Oil minister Murli Deora said, Not true. We are considering what to do. There is no decision yet on extending his term. He added that the vigilance panel report on Sibal is expected in 2-3 days.