Power plants to get surplus gas supplies until March 2016

Business

oi-Staff

By Super

Published: Saturday, August 24, 2013, 9:45 [IST]

New Delhi: Providing relief to power projects, the government on Friday said any surplus natural gas left after meeting the needs of urea plants would be supplied to fuel-starved electricity generating stations.

"At present, the fertiliser sector receives 31 million standard cubic metres per day of gas from domestic production and any additional gas beyond 31 mmscmd will be given to power," Power Minister Jyotiraditya Scindia told reporters here after a meeting of an Empowered Group of Ministers headed by Defence Minister A K Antony.

Power projects will get the surplus gas until March 2016, after which the situation will be reviewed again, Scindia said. The decision will benefit projects with a combined capacity of over 7,800 MW, he said.

"There are about 12-14 mmscmd of gas which in the next three years will come to the power sector," Scindia said when asked to quantify how much gas the power sector would get.

The Power Ministry had sought parity for electricity utilities with fertiliser units in the allocation of gas after a drop in output at Reliance Industries' KG-D6 block led to reduced domestic supplies. In March this year, electricity generating stations stopped getting gas from KG-D6.

Until now, gas-based fertiliser plants had topmost priority in the allocation of gas, followed by LPG-extraction units, power projects, city gas, steel and refineries.

Last month, the panel of ministers had rejected a proposal to snap gas supplies to urea plants and divert the fuel to power companies.

PTI