Reliance To Sell Gas To Anil Ambani Group Power Plant

[savramesh 37]

Business Standard

Friday, Apr 24, 2009

Billionaire Mukesh Ambani-run Reliance Industries will sell natural gas from its eastern offshore KG-D6 fields to Anil Ambani Group firm's power plant in Andhra Pradesh at government approved rates.

While ADAG has taken RIL to court seeking gas from KG-D6 at rates decided in a private agreement that split Dhirubhai Ambani empire between the two brothers, Power Ministry has identified Reliance Energy Ltd's Samalkot plant in Andhra Pradesh as one of the recipients of KG-D6 gas.

The 220-MW power plant has been allocated 0.19 million cubic meters per day of KG-D6 gas at government approved rates of $ 4.20 per million British thermal unit plus taxes and transportation, a government official said.

ADAG is seeking gas from RIL at $ 2.34 per mmBtu.

Samalkot is one of the eight power plants identified in Andhra Pradesh to receive KG-D6 gas from next month, he said.

Though RIL was promised marketing freedom when it won the KG-D6 block in Bay of Bengal in international tender, it has been stripped of all its rights and is being forced to sell the fuel from its discoveries it made in the block to customers identified by the government.

"RIL has already signed gas sales agreements with six power plants in Andhra Pradesh and I believe they would be doing the same with Samalkot next week," the official said.

Company officials could not be reached for comments.