Cabinet approves gas pooling for chemical sector

New Delhi: The $5.18 per million British thermal unit worth of domestic gas is concerning  the price of LNG. informing reporters concerning the selections taken by the cupboard headed by Prime Minister Narendra Modi, telecommunication Minister Shankar Prasad aforesaid gas pooling can facilitate save Rs one,550 large integer in grant and can profit thirty carbamide plants.

The Cabinet on Tuesday approved a proposal to pool or average out costs of domestic fossil fuel and foreign LNG utilized by chemical plants to form the price of fuel uniform and reasonable. chemical plants consume concerning forty two.25 million customary cubiform meters per day of gas for manufacture of supported carbamide. Out of this, 26.50 mmscmd comes from domestic fields and therefore the rest fifteen.75 mmscmd is foreign liquefied fossil fuel (LNG).

This would facilitate in specializing in rising plant potency and will facilitate in worth advantage in sourcing of LNG, he said. The move would facilitate bring down the price of fuel and facilitate save grant. Sources aforesaid the oil ministry in its proposal to the CCEA had planned creating state-owned gas utility GAIL Republic of India Ltd because the pool operator.

The cost of gas, that is that the most significant part for production of carbamide, varies from plant to plant attributable to differential rates at that foreign LNG is contractile additionally as value of transportation. the cupboard Committee on Economic Affairs (CCEA) has approved averaging of various rates of domestic and foreign gas to make sure offer of fuel to all or any carbamide plants at a standardized delivery value.

The pool operator can tie-up imports once considering domestic availableness and once averaging out worth of each, delivery the fuel at uniform rate to all or any plants. The pooling mechanism are effective from next month. Also, associate sceptered Pool Management Committee (EPMC) comprising representatives of oil ministry, department of chemical, department of expenditure and GAIL are fashioned.

The Department of Fertilisers can confirm the full demand of fossil fuel and draw plant-wide demand, which might then learn to the pool operator, GAIL.

This committee would approve the plant-wise gas provides to be created below gas pool mechanism and LNG purchases. There area unit thirty carbamide manufacturing units within the country, of that twenty seven area unit gas-based and 3 run on dissolver. Out of total consumption of concerning thirty million tonnes every year of carbamide, concerning twenty three million tonnes area unit made within the country.