Pvt power cos ask OilMin to re-allocate non-core sector gas

Private power producers are lobbying hard with the Petroleum Ministry for re-allocation of natural gas currently supplied to non-core users like refineries and steel plants to their units.

In a letter to Minister of Petroleum and Natural Gas Jaipal Reddy, Association of Power Producers (APP) Director General Ashok Khurana requested the government to "consider discontinuing gas to non-core sectors and use the same for core sectors, namely power and fertiliser".

Currently, over 18 million standard cubic metres per day (mmscmd) of natural gas is being supplied to non-priority/core sectors, the head of the body representing private electricity generators said in the letter.

Gas-based power projects with a generation capacity of about 4,000 MW are ready to commence power generation before March 31, 2012, and are awaiting gas allocation by the Empowered Group of Ministers (EGOM), he said.

Public money in the form of debt provided by various Indian banks and financial institutions is at a grave risk unless these projects start commercial operation by March 31, 2012, he added.

Total gas-based power capacity in India amounts to 16,600 MW and these plants currently consume 66 mmscmd of gas. The average capacity utilisation of these plants is around 70%.

The body also suggested that, "If the capacity utilisation of all these power plants is rationalised at 60% or so, about 80 mmscmd of gas will get released, which can be allocated to upcoming projects."