Mumbai: Oil & Natural Gas Corp (ONGC) has entered into a three-year agreement to sell its natural gas from its Olpad field in Ankleshwar to Gujarat State Petroleum Corporation Ltd (GSPCL).

Under this agreement, valid for three years, with an option to renew for another two years, ONGC will sell 1.5-lakh million standard cubic metres a day of natural gas to GSPL at $4.75 per million British thermal unit (mBtu).

The price being offered by ONGC is equivalent to what it has been getting for natural gas produced from the Panna, Mukta and Tapti (PMT) fields, which it operates in joint venture with Reliance Industries Ltd (RIL) and British Gas (BG).

The agreement also provides the option of a price review at the end of three years.

Ankleshwar, which went in to production in 1961, is one of the biggest oil and natural gas producing assets for ONGC and has enabled Gujarat emerging as a major onshore producer of crude oil and natural gas — Gujarat alone accounts for almost 18 per cent of India's total oil production over 10 per cent of the entire gas production.

The ONGC-RIL-BG joint venture will sell 5.4-million cubic metres a day (mmscmd) of gas from PMT fields to GAIL (India) Ltd at $4.75 per mBtu.