Reduced gas supply from Reliance Industries Ltd’s (RIL) Krishna Godavari D6 block has hit power generation of four Andhra Pradesh units. Officials said gas supply from the block was down by eight to 10 per cent.
A pro-rata cut has been made in the supply to GMR’s Vemagiri power plant, GVK’s Jegurupadu and Gautami plants and Lanco Infratech’s Kondapalli plant. The three power producers as well as the RIL spokesperson refused to comment on the issue.
According to a decision of the empowered Group of Ministers (eGoM), the Andhra power units are supposed to get enough gas to support 75 per cent plant load factors (PLF) and those outside the state to operate at 70 per cent PLF.
“With a fall in D6 production, these plants are receiving gas lower than the allocated amount for the last few months,” said an official. In the December quarter, GVK’s plant load factors for Gautami and Jegurupadu plants reduced to 75 per cent and 80 per cent, respectively, due to poor gas supply as well as lesser demand from the Andhra discoms. GMR’s Vemagiri plant’s PLF, too, was at 75 per cent in the December quarter.
The production from Reliance’s KG-D6 block has dropped from 54 million standard cubic metre a day (mmscmd) in the last quarter.
According to the schedule, RIL’s gas production is supposed to be around 60 mmscmd. “The KG-D6 gas production is expected to be at 60 mmscmd for 2011-12 and 2012-13 financial years. Given the lack of positive news flow on exploration, we also cut our exploration upside potential and now value a reserve base of 4.8 billion barrel of oil equivalent (7.6 billion barrel of oil equivalent earlier),” said a recent report of Royal Bank of Scotland.
This decline in production has increased concerns of the Andhra-based power units, as most of them are in an expansion mode. These companies are expecting incremental gas from RIL’s fields, after it starts producing 80 mmscmd.
GVK is expanding the Gautami and Jegurupadu plants by 800 megawatt each. Lanco, too, is expanding its power project by 742 megawatt at Kondapalli. GMR is expanding its 388.5 Mw unit in Vemagri by yet another 768 megawatts.
