Govt okays gas pooling for fertiliser sector
1 April 2015 5:41 AM IST
The Cabinet has approved a proposal to pool or average out prices of domestic natural gas and imported LNG used by fertiliser plants to make the cost of fuel uniform and affordable.
Fertiliser plants consume about 42.25 million standard cubic meters per day of gas for manufacture of subsidised urea. Out of this, 26.50 mmscmd comes from domestic fields and the rest 15.75 mmscmd is imported liquefied natural gas (LNG).
The USD 5.18 per million British thermal unit price of domestic gas is about half the cost of LNG.
Telecom Minister Ravi Shankar Prasad said gas pooling will help save Rs 1,550 crore in subsidy and will benefit 30 urea plants.
The cost of gas, which is the most important component for production of urea, varies from plant to plant owing to differential rates at which imported LNG is contracted as well as cost of transportation.
Fertiliser plants consume about 42.25 million standard cubic meters per day of gas for manufacture of subsidised urea. Out of this, 26.50 mmscmd comes from domestic fields and the rest 15.75 mmscmd is imported liquefied natural gas (LNG).
The USD 5.18 per million British thermal unit price of domestic gas is about half the cost of LNG.
Telecom Minister Ravi Shankar Prasad said gas pooling will help save Rs 1,550 crore in subsidy and will benefit 30 urea plants.
The cost of gas, which is the most important component for production of urea, varies from plant to plant owing to differential rates at which imported LNG is contracted as well as cost of transportation.
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