Petronet, RasGas ink pact to reignite Dabhol plant

Petronet LNG Ltd on Tuesday signed a contract with RasGas of Qatar for import of 1.25 million tonnes of liquefied natural gas to fire the beleaguered 2,150 mw Dabhol power plant in Maharashtra.

The contract will be for supply of natural gas in its liquefied form in cryogenic tankers from July to September 2008, PLL CEO and managing director Prosad Dasgupta said.

?The first cargo will arrive on July 7,? he said, but refused to divulge details on price of gas. ?We have committed to deliver at a price of $4.93 per million British thermal unit (mbtu) for the gas after pooling this contract price with the price of our existing long term contract ($3.86 per mbtu).? The agreement was signed by Dasgupta and RasGas managing director Hamad R Mohannadi in presence of RasGas chairman Ibrahim B Ibrahim, Qatar?s minister of state for energy and industry Mohammed Al Sada and India?s ambassador to Qatar George Joseph in Doha on Tuesday.

The LNG would be imported from Qatar at Petronet?s Dahej terminal in Gujarat and after regassification piped to Dabhol through state-run gas firm GAIL?s pipeline.

GAIL has given an undertaking that the much-delayed pipeline would be ready by July 10 but the company has neither signed a gas sales and purchase agreement (GSPA) for buying the gas with Petronet nor a gas sales agreement (GSA) with Ratnagiri Gas and Power Pvt Ltd for sale of gas.

If the company signs the two contracts and is unable to complete the pipeline by the scheduled date, it would be liable to pay for not taking deliveries (take-or-pay clause) to Petronet and compensate RGRRL for not making supplies (supply-or-pay clause).

Source: The Financial Express, New Delhi, 04 July 2007
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