NTPC willing to buy natural gas at any price fixed by the government for its Kawas and Gandhar expansion projects: Chairman

NTPC is ready to buy natural gas at any price fixed by the government for its Kawas and Gandhar expansion projects, but this will not dilute its position in its court battle with Reliance Industries for gas supply at a lower price for these plants, NTPC Chairman Arup Roy Chudhury said on Friday. NTPC took RIL to the Bombay High Court in 2005, complaining that RIL was not honouring a contract to sell 12 million standard cubic metres a day (mmscmd) of gas to its Kawas and Gandhar expansion projects in Gujarat for 17 years at $2.34 per unit. RIL contended the contract was not concluded. Natural gas from Reliance’s KG Basin has been sold at $4.2 per unit. NTPC was initially reluctant to buy this gas for the Kawas and Gandhar expansion projects as it felt such a move would go against the company in its legal case against Reliance Industries. 
    “We have approached the government to allocate gas… We have taken the solicitor-general’s opinion. It will not weaken our case,” he told reporters. NTPC is already buying 2.3 mmscmd gas from RIL’s KG-D6 basin for its other plants. It has a fair chance of getting priority fuel allocation for the Kawas and Gandhar projects, according to various government undertakings in the past. The government determines consumers of gas according to sectoral priority determined by an eGoM.
Importing LNG for power plants 
THE company is also weighing several options to import liquefied natural gas (LNG) for its power plants as it faces a scarcity of gas in the future. A team of executives is scheduled to travel to Qatar in the next few days to hold discussions. He said the company was looking for LNG equivalent to 1.3-1.4 mmscmd. Choudhury said Qatar was interested in acquiring equity in NTPC’s power projects, which the Indian company was willing to consider. NTPC, the country’s biggest power producer, is also taking steps to ensure smooth supply of coal for its power stations. The company had requested Coal India to arrange imports and was also looking for foreign mines to feed its domestic plants. In addition, the company was going to start importing coal itself, he said. Initially NTPC will arrange for imports of 4 million tonnes of coal, and gradually scale it up to 15 million tonnes a year. The state-run company is also taking initiatives to step up production of hydropower and to set up plants based on renewable sources and nuclear energy.Choudhury said NTPC was keen to acquire expertise in nuclear power so that it can set up such plants on its own. Initially it would enter the field jointly with the Nuclear Power Corp of India, he said.