Monday 2 November 2015

NTPC eyes low-cost RLNG from offshore spot markets

The RLNG currently available in the spot market is priced at US$7/mmBtu compared with US$11-$12/mmBtu provided by GAIL, the daily adds.


NTPC
NTPC is reportedly looking to source low-cost re-gasified liquid natural gas (RLNG) from spot markets overseas to improve margins.
A senior NTPC official told the newspaper that NTPC would rely on buying RLNG at spot prices that is cheaper by US$3-4/mmBtu than gas contracted through long-term contracts, reports a financial newspaper.
The RLNG currently available in the spot market is priced at US$7/mmBtu compared with US$11-$12/mmBtu provided by GAIL, the daily adds.
NTPC, which holds over 25% stake in Ratnagiri Gas & Power Ltd. (RGPPL), which is entitled to subsidised gas, is unable to generate any return on equity (ROE), reprots the business daily. 
The idea is to get spot RNLG for supplying power to industrial units as long-term PPAs with states is impractical for RGPPL power when coal-based is available to them at a cheaper rate, the newspaper adds.
It may be recalled that power generation at the 1,967 MW RGPPL had been halted for over more than a year due to the unavailability of cheaper domestic gas. 
RGPPL recently secured enough imported subsidised RLNG to run the plant at just over 25% plant load factor that would produce 500 MW. The Indian Railways has agreed to buy power from RGPPL.

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