Reliance admits delay in supplying KG deepwater gas

Vol 8, PW 20 (12 Jan 05) Midstream & Downstream

Reliance has officially admitted that its keenly awaited Krishna Godavari deepwater gas will only be available after March 2008 and not 2006-07 as originally claimed.

Our KG gas will be fully available by March 2008, said Reliance director RP Sharma during a 24th December meeting called by power secretary RV Shahi. The meeting was called by Shahi to review the progress of Independent Power Projects, amid growing concern that gas shortages have condemned several proposed gas-based power projects.

In a presentation to the meeting, Sharma blames the delay on government apathy in granting Reliance permission to lay a 1500-km gas pipeline from Kakinada to Ahmedabad, originally designed to evacuate Reliance gas from May 2007. Reliance received RoU clearance in May 2001, said Sharma.

(But) did not develop the pipeline because the draft gas pipeline policy permitting private sector pipelines was initiated only in September 2003 and is yet to be finalised. Sharma said another reason for the delay is that the oil ministry has only cleared 700-km of the Reliance gas pipeline and that approval for the balance is still pending.

But Sharma stressed that committed gas supply to NTPCs Kawas and Gandhar power plants and Reliance Energys 3000-MW proposed power plant in Dadri would be made on time. He said Reliance would make this possible by diverting gas from the Panna, Mukta and Tapti oil and gasfields where it has 30% stake and part marketing rights.

Not convinced, Shahi asked Reliance to accelerate development of its KG gasfield and give priority to the pipeline as it is critical for the development of gas-based power projects. He even offered to help Reliance with pending government approvals to ensure early supply of gas to projects in an advanced stage of completion.

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