NTPC will award gas contract sometime this week

Vol 10, PW 13 (19 Oct 06) News in Brief

Sometime this week NTPC is expected to award a contract for the purchase of gas for its Gujarat and Delhi power stations.

On 7th October, NTPC floated the tender for spot gas supplies for its Kawas, Gandhar, Anta, Auraiya, Dadri and Faridabad power stations. We understand offers of R-LNG were received from Shell, GAIL, Indian Oil and Bharat Petroleum.

NTPC opened the bids on 12th October and is now evaluating the offers. As expected, the prices offered are lower than those from a previous tender, which GAIL won quoting between $11.5 and $12.4 inclusive of taxes and transportation.

As with the previous spot gas tenders, NTPC has not indicated how much gas it wants, or for which power station, or for how long. All it has indicated is the average aggregate shortfall of 4m cm/d for all its power stations together.

NTPC is unwilling to enter into short or long-term gas supply contracts and prefers to buy spot gas supplies to benefit from price fluctuation.