Government approved a proposal to pool the prices of domestic natural gas and imported liquefied natural gas and supply them to domestic fertiliser plants at a uniform delivered price.
The government on Tuesday approved a proposal to pool the prices of domestic natural gas and imported liquefied natural gas (LNG) and supply them to domestic fertiliser plants at a uniform delivered price.
Briefing reporters after the meeting of the Cabinet Committee on Economic Affairs (CCEA), telecom Minister Ravi Shankar Prasad said gas pooling will help save Rs 1,550 crore in subsidy and will benefit 30 urea plants. There are 30 urea producing units in the country, of which 27 are gas-based and three run on naphtha.
Fertiliser plants consume about 42.25 million standard cubic meters per day of gas for manufacture of subsidised urea. Out of this, 26.50 mmscmd comes from domestic fields and the rest 15.75 mmscmd is imported liquefied natural gas (LNG), according to a PTI report. The pooling mechanism will be effective from next month.
Also, an Empowered Pool Management Committee (EPMC) comprising representatives of oil ministry, department of fertiliser, department of expenditure and GAIL will be formed. The committee would approve the plant-wise gas supplies to be made under gas pool mechanism and LNG purchases, according to the agency report.