The Petroleum Ministry has proposed a 33 per cent hike in the price of natural gas produced by ONGC and Oil India and gradually increase it to $4.20 per mmBtu set for gas from Reliance Industries' KG-D6 fields.
The EGoM has fixed priority for the 25 million standard cubic metes per day of gas Reliance plans to start pumping from September this year and 40 mmscmd from March 2009. It has asked the company to first supply gas from KG-D6 field, the first major field of NELP to go on production, to existing gas-based urea plants, which are now getting fuel below their full requirement.
The gas market in India is at an inflection point. The increase in gas supplies would also promote setting up of brownfield and greenfield projects
The country's most valued company Reliance Industries on Thursday reported 6.41 per cent drop in its stand-alone profit at Rs 3,852 crore (Rs 38.52 billion) for the second quarter of the current fiscal.The total income rose 5.88 per cent to Rs 47,476 crore (Rs 474.76 billion) during the quarter from Rs 44,839 crore (Rs 448.39 billion) in the corresponding period a year ago, RIL said in a filing to the Bombay Stock Exchange.
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Following adverse media reaction to the June 27 decision of the Cabinet Committee on Economic Affairs, the finance ministry had issued an office memorandum asking the petroleum ministry to see if there was a way to make RIL clear its gas supply backlog at the existing price.
The Mumbai terror attacks may derail Reliance Industries' plans to start natural gas production from its eastern offshore D6 field from January 2009, as several ex-pats have refused to return to India citing safety reasons.
HPCL's Vizag refinery in Andhra Pradesh was to receive the consignment of 65,000-70,000 tonne on November 17, but the ship carrying the oil could not offload it due to bad weather. The MA-1 oilfield started production in September. The company sold the first consignment to HPCL at a $5.34 a barrel discount to Nigerian crude grade Bonny Light.
Reliance Industries has said that it had in December 2005 signed a contract to sell natural gas to NTPC at $2.34 per mmBtu price for 17 years, but it was the state-run firm that did not reciprocate.
The Bombay high court has modified the interim order on the sale of KG basin gas by Reliance Industries.
The empowered group of ministers, however, decided to allocate the initial 40 million standard cubic metre per day of gas from KG-D6 basin to the existing power and fertiliser plants and proposed units like the captive power plant at Nagothane did not figure in the scheme of things. A company spokesperson confirmed the scrapping of the project.
Anil Ambani group firm Reliance Natural Resources on Friday posted a marginal increase in its net profit for the third quarter and said it hopes to get gas from Reliance Industries' KG-D6 fields once the group's Dadri power plant begins operations.
The company has already received an approval to spend Rs 50,000 crore (Rs 500 billion) for commercialising two of its biggest gas discoveries in the D6 block located in the KG basin. "In a letter to oil regulator Directorate General of Hydrocarbons, the company has submitted one more development plan for Rs 10,000 crore as additional capex (capital expenditure) for the block.
State-run NTPC, Essar Power and Torrent are among the firms identified by the Union power ministry for buying natural gas from Reliance Industries' eastern offshore D6 block.
"First orbit raising operation of GSAT-6 was successfully completed by firing the Apogee Motor for 3385 seconds at 8:35 pm IST on August 28," the ISRO said.
Reliance's entry into the club of integrated energy majors, courtesy the start of oil production in the Krishna-Godavari basin, marks a strategic inflection point for India, as it comes some three decades after the last major find at Bombay High went into production.
Reliance Industries will account for about 40 per cent of the country's energy production in the next 18 to 24 months, putting the company on track to earn a quarter of its profit from oil and gas production, from 5 per cent now.
Reliance Industries has created history by flowing oil from the nation's first deep-sea oilfield, but gas production from the eastern offshore KG basin will begin in January, four months behind the deadline. Reliance began oil production from its predominantly gas-rich KG-DWN-98/3 or D6 block on September 17 with initial oil flowing at the rate of 5,500 barrels per day, the company Chairman Mukesh Ambani announced on Sunday in Mumbai.
Pooling will also kick-start projects of Reliance Power, Torrent, Lanco.
Reliance Industries is in talks with global energy majors, like British Gas of the UK, Chevron Corp of the US, Exxon and Shell for a possible stake sale in its Krishna-Godavari basin gas fields. RIL is looking for a strategic partner for its KG-D6 gas block to get deep sea exploration technology. The percentage of stake to be divested has not been firmed up & may depend on the value that the partner was bringing in. The block contains over 50trillion cubic feet of gas reserve
Anil Ambani met Cabinet Secretary K M Chandrasekhar, Expenditure Secretary Sanjiv Misra and Fertiliser Secretary J Sreedhara Sarma to drum support against RIL's proposed pricing formula for natural gas from KG-D6 block off the east coast.
The Cabinet on Thursday decided to allow Reliance Industries to almost double the price of natural gas from April provided the firm gave a bank guarantee to cover its liability if gas-hoarding charges are proved.
Reliance Industries Chairman Mukesh Ambani met top government officials on Tuesday, including Cabinet Secretary and Principal Secretary to the prime minister, to explain his company's approach to pricing of natural gas to be produced from KG basin.
Petroleum Ministry has sought help from Law Ministry in resolving the Ambani demerger issue over the production of gas from KG fields.
The plant has been shut since 2013 for want of domestic gas supplies.
Monday's meeting of the empowered group of ministers on pricing of gas from Reliance Industries' D6 block in the Krishna-Godavari basin has proved inconclusive.
RIL is considering this deal as part of a long-term strategic move as the company needs a partner for the level of deepwater drilling that is required at this particular block, industry sources said on condition of anonymity. The potential partners could be among the global energy giants like ExxonMobil, Shell, BP, Total and Petrobras, as these are the companies with required expertise, sources said.
RIL's December quarter performance is likely to be muted
With pricing of natural gas from the KG-D6 block stuck, Mukesh Ambani made the second trip to New Delhi this month to meet top officials.
Reliance Industries and Oil and Natural Gas Corporation will present their views as producers on pricing of natural gas on Tuesday to a panel of top government officials formed to resolve the vexed issue.
The arbitration clause is present in almost 95 per cent of corporate agreements, according to tax and audit firm Ernst & Young.
A group of ministers, constituted to look into pricing and utilization of natural gas produced from new fields like the KG-D6 of Reliance Industries, is likely to hold its first meeting on August 27.
The official explained that the contractor would take the worst-case scenario into account "to be on the safe side", when working out the field development plan and the probable cost of exploration and development of the block.
The rates, on net calorific value (NCV) basis, dropped to $ 5.05 per mmBtu for six month period beginning April 1, 2015.
Fertilizer sector on Friday sought gas supplies from Reliance Industries's KG-D6 block at no more than 5 dollars per million British thermal unit, even as the power sector nudged the government to take its share of gas in kind.
RIL filed an appeal on Monday before a division bench headed by Chief Justice Swantra Kumar seeking a stay on an interim order by a single bench restraining it from selling gas to companies other than RNRL and NTPC.
Justice Anoop V Mohta, delivering the final verdict in the gas supply row between RIL and Reliance Natural Resources Limited, asked the two companies to decide on a new gas price, as the rate of $2.34 per mBtu agreed in the family de-merger agreement had already been rejected by the government.
Reliance Industries Limited, the country's largest private sector company, is raising $2 billion through a 10-year overseas syndicated loan for funding its oil and gas exploration in the D6 block of the Krishna-Godawari basin.
The Prime Minister's Economic Advisory Council has approved Reliance Industries' 4.33 dollars per mBtu price of gas from KG-D6 fields, saying it was in line with industry practices.
The fixed line broadband will offer "ultra high-definition entertainment on large screen TVs, multi-party video conferencing from your living room, voice-activated virtual assistants, virtual reality gaming, digital shopping, immersive experiences," Ambani said.
For India's upstream sector that has seen no new discovery coming into production.
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