AMBANI-NTPC 2

The price of USD 4.2 per million British thermal unit for
KG-D6 gas has been fixed by the government without prejudice
to the NPTC's case against RIL seeking fuel at prices
committed in 2004.

The expansion project of 2,600 MW at Kawas and Gandhar in
India's western state of Gujarat, for which RIL had committed
gas at USD 2.34 per mmBtu in 2004, will generate 19.36 billion
units of power in a year.

"The total savings in a year for purchase of this
electricity by distribution companies/State Electricity Boards
will be around Rs 2,130 crore per year. For 17 years, it works
out to be around Rs 32,000 crore and will directly benefit the
consumers," NTPC said in its filing.

NTPC said the government had allocated only 2.67 mmscmd
of gas from KG-D6, as against a shortfall of 8-9 mmscmd at its
plants. To meet the deficit, the company is sourcing fuel from
various sources including buying imported LNG.

"There is no truth in any statement saying NTPC is buying
costlier gas since it is a pass through for NTPC. NTPC has
already been procuring spot regassified-LNG at competitive
rates from market through tenders and without any take or pay
liability," it said.

NTPC claimed that a draft GSPA was finalised before RIL's
USD 2.34 per mmBtu price bid was accepted and the said
agreement had a clause for liability in the event of default
in supply of gas.

RIL, however, made "unilateral" changes in the GSPA
before forwarding it to NTPC, the PSU said. (MORE) PTI