Gail keeps options open on RLNG | india | Hindustan Times
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Gail keeps options open on RLNG

GAIL (INDIA) Ltd is keeping its options open on arranging more imported Regassified Liquefied Natural Gas (RLNG) on the prevailing ?Freight on Board? (FoB) price of $ 8 to $ 10 per million metric British thermal unit (mmbtu) for fuel-starved industrial units in the State.

india Updated: Apr 21, 2006 00:56 IST

GAIL (INDIA) Ltd is keeping its options open on arranging more imported Regassified Liquefied Natural Gas (RLNG) on the prevailing “Freight on Board” (FoB) price of  $ 8 to $ 10  per million metric British thermal unit (mmbtu) for fuel-starved industrial units in the State.

“Some large industrial units in Uttar Pradesh had complained of receiving less than the required RLNG supplies per day from the Hazira-Vijapur-Jagdishpur (HVJ) pipeline and were instead using naphtha as feedstock to meet the shortfall to run their plants. In such a scenario, imported RLNG could be provided at FoB prices to meet the fuel supply shortfall for the time being,” a senior Gail official told the HT from New Delhi. The non-FoB price of  RLNG currently being made available to a large number of industrial units in Uttar Pradesh was a much cheaper $ 4.86 per mmbtu drawn from the HVJ pipeline, he said.

“At the outset, a large number of industrial units in Uttar Pradesh, using RLNG as feedstock, are being advised to start demanding a subsidy from the Central Government for being able to afford imported RLNG on the FoB prices as they had been doing for purchasing naphtha, whose price is currently pegged in the range of $  12 to $ 13 per kg in the international market,” he said.

Industrial units can save nearly 23 to 25 per cent of fuel costs compared to naphtha by applying for government subsidy for purchasing RLNG at the FoB price during the period when they had been receiving less fuel supplies at $ 4.86 per mmbtu to run their plants, he said. “With the price per barrel of crude oil prevailing at $ 70, the price of naphtha is expected to go even further in the coming months. The subsidized RLNG, if available, will ease the demand pressure for the fuel from the HVJ pipeline for industrial units in Uttar Pradesh,” the official added.