Gas EGoM likely to okay supply for Lanco, GMR, Sravanthi power units

When the empowered group of ministers (EGoM) meets for gas allocation on July 27, it is likely to commit supply for power plants coming up in 2011-12.Among those likely to get allocation are Lanco Infratech, GMR and the South India-based Sravanthi group. It would be a tough call for the EGoM, though, since the government has received requests totalling over 350 million standard cubic metres a day (mscmd).

Lanco is likely to get an allocation for the 742 Mw third phase of its Kondapalli power plant, near Vijayawada. The Gurgaon-based company has two operational gas-based power plants, at Kondapalli and at Karuppur in Tamil Nadu. Currently, it has units of 368 Mw and 366 Mw at at Kondapalli. The Karuppur unit is a small one, with 120 Mw capacity.Officials said GMR was also seeking natural gas for 768 Mw capacity, while Sravanthi plans to set up a 228 Mw plant.

The Anil Ambani group has sought 28 mscmd for four gas-based power projects, including Dadri in Uttar Pradesh, Shahapur in Maharashtra's Raigarh district, Jambusar in Gujarat’s Bharuch and Samalkot in Andhra Pradesh.

The group that had fought a bitter battle with Mukesh Ambani-owned Reliance Industries Ltd for gas for its Dadri power project seems to have diluted the demand for this one. “Since Dadri power plant is under litigation in the Supreme Court over land acquisition, the request for Dadri is subject to case being resolved,” said an executive close to the development.

A senior official said the Ministry of Petroleum and Natural Gas would be briefing the EGoM on the production profile of the Reliance Industries’ D6 field. Following the scheduling of the meeting, the ministry had asked the directorate general of hydrocarbons to send a fresh estimate of D6 production, currently around 60 mscmd of gas. This was to be raised to 80 mscmd and remain at that level for eight years. The government has already made firm allocations for about 62 mscmd and a fall-back (temporary) allocation for another 30 mscmd.

Since the production equals the firm allocations, the new allocations might be made from the fall-back quantities. The meeting of the group would be the first one after the Supreme Court upheld the union government’s sovereign right over natural gas and made the Ambani brothers renegotiate a gas deal in compliance with the government policy.