Dabhol to get gas at $5.84 mBtu, generating cost at Rs2.80

18 January 2007

The gas-starved Dabhol power plant in Maharashtra will receive gas at $5.84 per million British thermal units (mBtu) from June this year. This translates to a generating cost of Rs2.80 per unit.

Rantagiri Gas and Power Pvt Ltd, an NTPC-Gail joint venture, own the Dabhol plant.

The cost of gas and power generation has been arrived at by allowing Petronet LNG to pool the price of the cheaper Qatar LNG with the costlier imported spot purchases.

An empowered group of ministers yesterday approved the pooling mechanism under which Petronet's existing customers for 5-million tonnes will pay $1.25 per mBtu more, enabling Dabhol power plant can generate electricity at Rs2.80 per unit.

Petronet LNG currently supplies five million tonnes of LNG bought from Qatar's Rasgas at a delivered price of $4.60 per mBtu. Though these supplies cost $2.79 (ex-ship), the spot purchases are around $7 to $8 per mBtu.

From June this year Petronet will import 1.5-million tonnes of LNG in 24 spot cargoes at two cargoes a month.