Gujarat Gas Company (GGCL), the largest private sector gas distributor in the country, today signed an agreement with Cairn Energy and partners to buy natural gas from the CB-OS/2 block in the Lakshmi field near the Cambay basin in Gujarat.
The contract provides for supply of 1.27 million cubic metres a day (mcmd) for five years beginning July 1, 2002. The other partners of Cairn Energy in the Lakshmi field include Tata Power Ltd and Oil and Natural Gas Corporation (ONGC).
GGCL managing director Robert Thomas said demand for natural gas in Gujarat far exceeds the supply. Hence the growth of the gas industry in the state has been constrained primarily by the lack of supplies.
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Gujarat Gas is now in a much stronger position to provide additional gas supplies to meet the needs of the market. This in turn will boost the growth potential of GGCL from the next financial year, he maintained.
Moreover, because of the above agreement with Cairn, significant financial benefits would accrue to Gujarat Gas in terms of revenues generated from transmission of gas between Lakshmi field to Gujarat Powergen Energy Corporation (GPEC) through its 73 km Hazira-Ankleswar transmission pipeline, he added.
GGCL, with operations in Surat, Bharuch and Ankleshwar, is ideally placed to receive gas from the CB-OS/2 block in the Lakshmi field. The company today sells 11.7 lakh cubic metres per day to over 1.30 lakh customers through a 1,500 km pipeline system.