Gujarat Gas sees sales plunge under GSPC

Vol 18, PW 11 (29 Jan 15) Midstream & Downstream
     

Things are looking grim for former BG retailer Gujarat Gas under its new owner GSPC.

Gas sales have fallen by almost a third from a high of 3.3m cm/d in 2012-13 in Surat, Bharuch and Ankleshwar to an all-time low of just 2.2m cm/d in December 2014. “Textile mills were our big customers,” reports a Gujarat Gas source.

“But with more and more mills switching over to cheap coal, gas sales have been hit.” The number of factories taking gas from Gujarat Gas has shrunk from nearly 1000 to just 758 by December 2014.

“Even the factories which take gas have cut their intake,” we hear. Surat textile mills which manufacture cheap cloth and saris are very cost conscious.

“I can’t afford to manufacture cloth if my mill gets gas at $20/mmbtu plus,” a mill owner tells us. A rival gas retailer wonders what Gujarat Gas and owners GSPC are doing to try to reverse the sharp fall in sales.

Also Gujarat Gas has been adversely hit by the cut in PMT gas supplies at $5.65/mmbtu since November 2013 following the announcement of a new gas allocation policy. But on the bright side owner GSPC’s overall sales figures from GSPC Gas, Gujarat Gas and its joint venture with Bharat Petroleum Sabarmati Gas stand at an impressive 7.94m cm/d for the calendar year ending December 31, 2014.