Power Min asks Oil Min to allocate gas to 10 projects

The Power Ministry has asked the Oil Ministry to allocate gas to 10 power projects that are running at half of their generation capacity due to non-availability of the fuel.

"We have written to the Ministry of Petroleum and Natural Gas to provide 8 mmscmd (million standard cubic metres per day) of gas to 10 power projects in the country," a Power Ministry official said.

The ten gas-based projects include both state-run and private projects, which are suffering due to a lack of fuel. "These (10) projects are running at 50% capacity," he added.

The Power Ministry has also communicated that around 3,500 MW of gas-based capacity that was likely to be added during the 12th Five-Year Plan (2012-17) is stranded, as there has been no assurance from the Oil Ministry on fuel supply.

State-owned NTPC has slashed its gas-based capacity addition target by 5,000 MW due to the shortage of gas. NTPC currently has a gas-based capacity of about 4,000 MW.

"How can NTPC go-ahead with the capacity addition plan if there is no fuel available?", the official asked.

The Oil Ministry may not provide gas to merchant power plants as it is of the view that domestic natural gas, which is cheaper than imported gas, should be supplied to companies that sell all power produced from the gas at regulated tariffs.

Around 2 mmscmd of gas is required to fire a 500-MW power plant.