GAIL to market all of PMT gas

GAIL India, the country's largest transporter and marketer of natural gas, today signed contracts with the operators of the field to market the entire volume of gas from the Panna-Mukta and Tapti (PMT) fields.

The state-owned gas utility signed the purchase contract with Reliance Industries (RIL), British Gas India and Oil and Natural Gas Corporation (ONGC) - the operators of the fields.

It has also entered into pacts with gas consumers, including RIL and BG, for selling gas at the government-approved price of $5.7 per million British thermal unit (mBtu).

Marketing the entire 17 million cubic meters per day (mcmd) of gas from the PMT fields will increase GAIL's marketing margin by Rs 100 crore annually, while transportation revenues will go up by Rs 450 crore annually.

"We signed the contracts to purchase and sell the entire volume of PMT gas," said BC Tripathi, director (marketing), GAIL India.

RIL and BG had earlier refused to sign the contract unless they were given a share of the gas from the field to feed their requirements.

RIL will get 3.6 mcmd of gas, while BG will receive 2.13 mcmd which will be routed through the company's subsidiary, Gujarat Gas, for supply in Gujarat.

Around 5 mcmd will be supplied to power and fertiliser plants, while GAIL will use around 2.8 mcmd of gas to extract LPG.

GAIL had earlier bagged the rights to market 4.8 mcmd of PMT gas, while the joint venture partners were allowed to directly market 5.6 mcmd till March 2006.

On instructions from the Prime Minister's Office for a more uniform distribution of the natural resource, in December 2007, the oil ministry scrapped all contracts for sale of gas produced from the PMT fields and nominated GAIL for selling it to 'fuel-starved' fertiliser plants outside Gujarat.

In 2005, the ministry had given the PMT joint venture freedom to market gas. It, however, in a surprise move in December 2007, decided to divert all the PMT gas to GAIL, barring quantities committed to Rajasthan Rajya Vidyut Utpadan Nigam (RRVUNL), for sale at higher price of $5.7 per mBtu.

Gujarat State Petroleum Corporation, which drew 1.3 mmscmd gas from PMT, would not get any from April 16.

ONGC holds 40 per cent stake in the PMT fields, while RIL and BG India hold 30 per cent each.

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RIL strikes gas in K-G basin again

Reliance Industries (RIL) on Monday announced that it has disovered natural gas in an exploration block (KG-DWN-2003/1 of NELP-V) located in the Krishna basin.

This is the second gas discovery by RIL in this block. RIL holds 90 per cent participating interest in the block and Hardy Exploration and Production India Inc the rest 10 per cent.

The potential commercial interest of the discovery is being ascertained through more data and analysis.

The discovery dubbed 'Dhirubhai"�41' has been notified to the government and the Directorate General of Hydrocarbons.

In February, RIL made the first gas discovery in the same block, named Dhirubhai-39, and the notification about potential commercial discovery was submitted to the central government and the Directorate General of Hydrocarbons.

In the last quarter of FY08, RIL has made four discoveries "� two in the Krishna basin deep waters, one in shallow waters of the same basin and one in the Mahanadi basin.