The Hindu : Business : ONGC unit to restart operations

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Thursday, Aug 17, 2006

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ONGC unit to restart operations

Special Correspondent

Losses estimated at Rs. 500 cr. at Hazira during the closure

NEW DELHI: The Hazira gas processing facility of the Oil and Natural Gas Corporation (ONGC) will restart operations on August 19, after being closed down owing to floods since last week. The ONGC Chairman and Managing Director, R. S. Sharma, who visited the marooned complex, said the situation was better than expected and that the plant might be restarted two days ahead of schedule. Preliminary estimates, however, peg the losses of the ONGC at about Rs. 500 crore during the closure period while the profit loss may be Rs. 200 crore, he said.

The flooding at Hazira had affected supplies of natural gas through the Hazira-Vijaipur-Jagdishpur (HVJ) gas pipeline to many industries, including compressed natural gas (CNG) needs of Delhi. The HVJ pipeline operations are expected to begin a day after the plant begins functioning. Mr. Sharma said the Hazira plant would begin functioning in phases with six million standard cubic metres of gas a day being produced initially. Gas supplies have been rationed since last week with power, transport for CNG needs in Delhi and the fertilizer sector getting priority.

The Chairman said the Hazira plant would resume its normal operations by the second or third week of September. As for insurance on the onshore facilities, he said insurers would pay for all repair, replacement and refurbishment after deducting $2 million. The plant shut down is estimated to cost the company Rs. 21 crore a day in revenue and Rs. 17 crore a day in profits.

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