Thursday, August 26, 2010

Natural gas - availability and enhancement Strategy

The Minister further stated that cost of production of natural gas varies from field to field, depending on inter alia geological conditions, age of field,  location of  field, cost of equipments & services, etc.   Gas available under Administered Price Mechanism (APM) and New Exploration Licensing Policy (NELP) is sold at US $ 4.2/million british thermal unit (mmbtu) inclusive of royalty.   As regards customers in the North-East,  subsidy  of 40% is given by the Government.  Gas available under pre-NELP contracts is sold at an average price of US $ 5.24/mmbtu.  Further, LNG imported under long-term agreement is sold at US $ 6.53/mmbtu, while the price of spot cargo presently varies in the range US $ 5.40-9.4/mmbtu.

            The Petroleum Minister added that Government has adopted a multi-pronged strategy to enhance availability of natural gas in the country, consisting inter alia of the following:-

i)                    Intensification of domestic Exploration & Production (E&P) activities through NELP rounds,
ii)                  Coal Bed Methane(CBM),
iii)                 Underground Coal Gasification,
iv)                Gas Hydrates,
v)                  Import of LNG from various countries, and
vi)                Transnational pipelines, viz., Iran-Pakistan-India (IPI) Pipeline and Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline.

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