Dabhol plant to get gas by June: GAIL

The Ratnagiri Gas and Power Pvt Ltd is likely to get gas for power production by June-end, GAIL (India) chairman UB Choubey said.

GAIL is laying the Dahej-Dabhol pipeline that will feed regassified liquefied natural gas to the Dabhol power plant from Petronet LNG's plant at Dahej in Gujarat. The 576-km-long pipeline is being laid at an estimated investment of Rs 3,200 crore (Rs 32 billion).

GAIL, the country's largest transporter and marketer of gas, today commissioned the first of the five stretches of the Dahej-Panvel-Dabhol pipeline. The 100-km stretch runs from Dahej to Surat in Gujarat.

During the gas-in ceremony of the first 100-km stretch of the pipeline, petroleum minister Murli Deora said, "The work on the remaining approximately 15 to 20 km stretch would soon be completed and the pipeline would be commissioned in a month or so."

He also said that disputes regarding the pipeline between Gujarat and Maharashtra have been resolved.

The Gujarat government had earlier refused to permit construction on a 12-km section of the Dahej-Uran gas pipeline in Surat. The Maharashtra government had written to the Centre seeking an immediate solution to this impasse.

The gas pipeline from Dahej in Gujarat up to Uran in Maharashtra will go on to Dabhol to provide gas linkage to revive the Dabhol project, one unit of which is currently generating electricity using naphtha as feedstock.

The Gujarat government has, however, claimed that the proposed new gas price pooling system - which would take an average price of imported LNG and the one being supplied under the long-term supply contract - would cast an additional burden of Rs 750 crore (Rs 7.5 billion) on the state.

Saurabh Patel, Gujarat's energy minister told Business Standard that the Centre was extending support to Ratnagiri power project and to Maharashtra state government at the cost of Gujarat and its industry. 

Gujarat-based customers who have tied up for imported LNG at a price of around $3.83 per mmbtu, would now get the  gas at around $5.83 per mmbtu.

However, for Ratnagiri Power the gas price pooling mechanism would reduce the cost of its spot LNG from around $7.5 per mmbtu to $5.6 per mmbtu.