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Thursday, May 29, 2008
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Fertilizer, power to get priority

Sujay Mehdudia

NEW DELHI: The Empowered Group of Ministers (EGoM), headed by External Affairs Minister Pranab Mukherjee, on Wednesday decided to give top priority to fertilizer and power sectors in the allocation of natural gas to be produced from fields such as Reliance Industries’ eastern offshore KG-D6 block.

The EGoM decided that for 2008-09 fiscal the demand of existing gas-based fertilizer plants would be met first from production from fields such as KG-D6. After fulfilling the unmet demand of fertilizer units, gas will be allocated to existing gas-based power units. Nearly 7,000 MW worth of power projects, ready to be commissioned, are lying idle due to non-availability of gas. It was decided that the gas utilisation policy would be only for the current fiscal and that the policy for the future would be decided later.

Official sources said that the KG-D6 field would bridge the gap between the demand of 43.169 million standard cubic metres a day (mscmd) and the supply of about 29 mscmd. It will then supply 18 mscmd gas to the stalled power plants.

“Fertilizer sector has been accorded the top priority. It will get first preference on gas to be produced from fields operated by private firms,” Fertilizer Minister Ram Vilas Paswan told journalists after the meeting.

Besides the unmet demand of gas-based plants, about 6.5 mscmd of gas will be given to naphtha-run plants that will convert to gas next year. Another 3.16 mscmd gas would be allocated in 2010 to plants currently fired by fuel oil. Eight fertilizer plants that are shut will get 14.7 mscmd gas by 2011-12, Mr. Paswan said.

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