GAIL to sell entire prodn from Panna-Mukta

GAIL India, the country’s largest transporter and marketer of natural gas, today signed contracts for marketing the entire volume of gas produced from the Panna-Mukta and Tapti (PMT) fields.

B C Tripathi, director (marketing), GAIL, said: "We have signed contracts for selling the entire volume of PMT gas."

The right to market the entire 17 million cubic meters per day (mcmd) of gas produced from the fields would increase GAIL's marketing margin by Rs 100 crore annually while its transportation revenue would rise by Rs 450 crore annually.

The state-owned gas utility signed purchase contracts with the fields’ operators Reliance Industries (RIL), British Gas India and Oil and Natural Gas Corporation (ONGC). It also entered into agreements with gas consumers including RIL and BG for selling gas at the government-approved price of $5.7 per million British thermal unit (mBtu).

RIL and BG had earlier refused to sign the contract unless they were given a share of the gas from the field to feed their requirements. With the signing of this contract, RIL would get 3.6 mcmd of gas from the PMT fields for its petrochemical plants, while BG would get 2.13 mcmd of gas which will be taken by the company’s subsidiary Gujarat Gas for supply to cities in Gujarat.

Around five mcmd of gas would be supplied to power and fertiliser plants, while GAIL would also use around 2.8 mcmd of gas to for extracting LPG.

GAIL earlier had the rights to market only 4.8 mcmd of PMT gas, while the joint venture partners were allowed to directly market 5.6 mcmd gas till March 2006. The government, last November, had allowed GAIL to market the entire volume of gas produced from the PMT fields.

While ONGC holds 40% stake in the gas fields, RIL and BG India hold 30% each.