India: Govt to prioritise natural gas allocation

NEW DELHI: Fertiliser plants will have the first right over domestic natural gas, followed by petrochemical and existing power units if the government approves a draft natural gas utilisation policy.

According to the draft prepared by the Petroleum Ministry, natural gas produced from fields like eastern offshore KG-D6 field of Reliance Industries or Panna/Mukta and Tapti field off Mumbai, would first be given to the fertiliser sector as existing gas-based fertiliser units were running at less than designed capacity because of shortage of gas.


Priority would then be given to petrochemical units as they have a higher degree of gas price sustainability since their products sell at market prices. LPG fractionators would be given priority at the same level so that all fractions of natural gas utilised.

The draft policy, prepared on instructions from the Empowered Group of Ministers on gas, fixed third priority as existing gas-based power projects with PSU units being given first preference.

Economic Times