NTPC to continue gas tenders

Vol 13, PW 6 (27 Aug 09) News in Brief

NTPC will continue to issue short-term tenders to procure gas for its gas-fired power plants, despite a recent 10-year gas supply agreement with GAIL.

In July, NTPC signed an agreement with GAIL to buy 2.5m cm/d R-LNG for six of its plants in western and northern India: Anta, Auriya, Kawas, Gandhar, Dadri and Faridabad. Newspapers reported the price as $6/mmbtu, though a GAIL source tells us this is incorrect: “The price will be in line with what Petronet-LNG pays RasGas,â€‌ he says.

“It will fluctuate.â€‌ NTPC tells us the contract with GAIL will not be enough to fulfil its total gas requirement of up to 16m cm/d.

“We will continue to issue tenders,â€‌ says NTPC. “Lots of gas is available and prices are good.

â€‌ These days NTPC reports that it gets a much better response to its tenders and that it is paying around$7.5/mmbtu for R-LNG, depending on the location of its plant. “The price increases after adding other charges like transportation, marketing margins and taxes,â€‌ we hear.