The Hindu : Business : GAIL seeks review of gas pricing

Online edition of India's National Newspaper
Tuesday, Aug 28, 2007
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Business

GAIL seeks review of gas pricing

Sujay Mehdudia

NEW DELHI: Stepping in late in the ongoing ‘gas price war,’ GAIL (India) has written to the Union Petroleum and Natural Gas Ministry seeking a review of the natural gas price produced from the Panna, Mukta and Tapti (PMT) fields off the Mumbai Coast.

The gas from these fields is produced by the consortium of Reliance Industries, British Gas of Britain and ONGC.

Officials in GAIL were of the view that it was the right time to seek a review of the supply prices of gas from the PMT fields as the EGoM is already seized of the matter pertaining to the KG basin. The PMT consortium was being paid a rate of $4.75 per million British thermal unit (mBtu) and also for supplying the entire volume of gas produced from the PMT fields to GAIL.

In its communication, GAIL has pointed out that in March 2005 it was decided that the PMT consortium would supply six million standard cubic metres per day of gas to GAIL for one year at $3.86 per mBtu. A year later, it was decided that the consortium would supply gas in excess of 4.8 mmscmd out of the total available gas at $4.75per mBtu till March 31, 2008.

The gas purchased by GAIL (India) was now being sold to core sector consumers at administered price $2.1 per mBtu.

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