Cabinet panel approves plan to develop gas finds
Potential of the gas from these discoveries is valued at over Rs 1 lakh crore
By : DC Correspondent
Update: 2015-04-29 23:35 GMT
New Delhi: In a move which could bring a whopping 90 billion cubic meter of natural gas production on line, the Cabinet Committee on Economic Affairs (CCEA) under Prime minister Narendra Modi on Wednesday approved a policy to allow development of a dozen contentious gas discoveries of Reliance Industries and ONGC.
The potential of the gas from these discoveries is valued at over '1 lakh crore at the current gas price of $4.66 per million british thermal unit on gross calorific value. As per the policy approved by the CCEA, companies have the options to either develop the finds at their own risk or perform DGH-prescribed conformity tests before developing them and recoup entire cost.
“The policy will settle the long pending issue with regards to 12 discoveries in five blocks pertaining to ONGC (six) and Reliance Industries (six) but will also establish a clear policy for the future,” said the petroleum ministry. It will also help in bringing out transparency and uniformity in the decision making as against case by case approach in the past. It allowed companies to develop the discoveries after conducting drill stem test (DST) with 50 per cent cost of DST being disallowed as penalty for not conducting the test on time.