RIL, Essar seek to sell CBM gas at market rates

Private explorers Reliance Industries, Essar Oil and Great Eastern Energy Corporation (GEECL), who have committed to invest around $2 billion in coal bed methane (CBM) blocks over the next three to five years, have sought freedom to sell gas from these blocks at market rates. The firms wants the pricing mechanism adopted by theNarendra Modi government for the auctioning of 69 small and marginal fields to be extended for CBM blocks.

On September 23, industry body FICCI, on behalf of these industry players, wrote to K D Tripathi, secretary, ministry of petroleum and natural gas, suggesting that the price discovery mechanism, proposed under the marginal fields policy, should be made applicable to CBM contracts as well, since they are based on the revenue sharing contract model like the marginal fields.

The private players say that gas pricing becomes a key factor in incentivising the contractors to make continuous investments required to start commercial production and maintain these throughout the life of the project.

https://www.khabarindia.in/ril-essar-seek-to-sell-cbm-gas-at-market-rates/