RIL says has lost $400 mn due to delay in gas use - Hindustan Times
close_game
close_game

RIL says has lost $400 mn due to delay in gas use

Hindustan Times | ByAnupama Airy, Kakinada (andhra Pradesh)
Sep 13, 2009 08:27 PM IST

Mukesh Ambani-led RIL says it has suffered a $400 mn (Rs 1,960 crore) revenue loss since May this year and continues to take a hit of $100 mn (Rs 490 crore) per month by keeping the gas production from its D6 gas block in the Krishna-Godavari basin lower than its potential.

Mukesh Ambani-led Reliance Industries Ltd (RIL) says it has suffered a $400 million (Rs 1,960 crore) revenue loss since May this year and continues to take a hit of $100 million (Rs 490 crore) per month by keeping the gas production from its D6 gas block in the Krishna-Godavari basin lower than its potential.

HT Image
HT Image

RIL needs government approval to sell its gas. The company, whose fortunes are tied to the government’s gas use policy, currently has the potential to produce over 60 million standard cubic meters of gas per day (mmscmd) from its KG-D6 gas block but is producing 36 mmscmd. Government has allocated 40 mmscmd to key sectors like power, fertilisers and steel.

Hindustan Times - your fastest source for breaking news! Read now.

“We have been suffering a lack of demand since May and at present, we are producing 60 per cent of what we can produce from the block,” RIL’s executive director P.M.S. Prasad, who was recently appointed to the company’s board, told Hindustan Times.

Analysts say that the government may be dragging its feet on account of RIL’s court dispute with Anil Ambani’s Reliance Reliance Natural Resources Ltd and public sector NTPC over the supply of 40 mmscmd of gas.

Prasad said the interest burden was mounting. “We had a certain schedule for repayment of debt, which will now get deferred and we will have to pay $17-18 million per month higher as interest cost,” he said.

RIL’s internal target is to reach 80 mmscmd by December, but it could stretch to March or beyond on account of uncertainties, he said.

Reliance Industries claims that it already has 25 to 30 customers from that are ready to buy up to 82 mmscmd gas. It also has an internal demand for 17 mmscmd.

Unlock a world of Benefits with HT! From insightful newsletters to real-time news alerts and a personalized news feed – it's all here, just a click away!- Login Now!
Stay informed on Business News along with Gold Rates Today, India News and other related updates on Hindustan Times Website and APPs
SHARE THIS ARTICLE ON
Share this article
SHARE
Story Saved
Live Score
OPEN APP
Saved Articles
Following
My Reads
Sign out
New Delhi 0C
Friday, March 29, 2024
Start 14 Days Free Trial Subscribe Now
Follow Us On