ONGC to Supply Gas to Rajasthan's 330 MW Dholpur Power Plant

ONGC will supply Gas to Rajasthan Rajya Vidyut Utpadan Nigam Ltd. (RRVUNL) for its 330 Mega Watt (MW) power plant coming up at Dholpur, to partially bridge the acute power shortage in the western state. This brings a new dimension to the association between ONGC and Rajasthan, which is more than four decades old.

A Gas Sales and Purchase (GS&P) agreement was signed between ONGC and the Rajasthan entity on 31st October 2005 at Jaipur. The signing ceremony was presided over by the Hon’ble Chief Minister of Rajasthan Ms. Vasundhara Raje

The Dholpur power plant is a combined-cycle power project being set up at a cost of Rs.1155 Crore. The agreement envisages gas supply by ONGC to the power plant for a period of 12 years, which can be extended later.

Under this agreement, ONGC will supply 1.5 Million Standard Cubic Meter gas per day from its share of Panna Mukta Tapti (offshore) Joint Venture to RRVUNL, at a FOB price of US$ 4.6 per Million Metric British Thermal Unit (MMBTU). The actual annual value of this agreement will depend on the calorific value of the supplied Gas.

The Gas will be used to run two turbines to produce 220 MW power. The other 110 MW power shall be produced by steam turbine. The two combined-cycle gas turbines will be supplied by Bharat Heavy Electricals Ltd. (BHEL). The construction for the project is scheduled to start from December 2005.

Apart from the Chief Minister, the signing ceremony was attended to by several state Ministers, secretaries of the government of Rajasthan and chairmen of state public enterprises of Rajasthan.

Terming the occasion as a ‘unique and happy’ one, the Rajasthan Chief Minister thanked Mr. Subir Raha and ONGC for enabling start of the long-awaited power project which was planned two decades earlier but was delayed for various reasons.

C&MD of ONGC Mr. Subir Raha said that ONGC, along with its Joint Venture (Panna Mukta Tapti) partners in British Gas and Reliance Industries, would be investing US$ 800 million in expanding production from the Panna Mukta Tapti offshore fields, from where the gas for this power plant would arrive.

Mr. Raha said that ONGC partners Cairn Energy in the recent oil discovery in Rajasthan, and the government has nominated MRPL (where ONGC holds 71.6 per cent equity) as the buyer of this Barmer crude. “So, it is going to be a privilege for the ONGC Group to set up the first refinery in the state, where the Rajasthan government would also be a partner”.

Highlighting the support of the Rajasthan government, he said that the location of the 7.5 million metric tonnes (MMT) per year refinery would be firmed up within a month. 5 MT of this would come from the local Barmer field and the balance would arrive from ONGC’s domestic (Western Offshore) and overseas (Sudan) assets.

Mr. Subir Raha shared that the refinery would be set up with an investment of around Rs. 9,000 Crore, the single-biggest investment in Rajasthan by any company. “The refinery project itself would bring many spin-offs, which would make a lasting contribution to the economy of Rajasthan”, he said.

The gas strike at Chinnawala Tibba in Rajasthan has provided rich gas (with high calorific value) in the state for the first time. Mr. Raha said that this is going to bring about a new dimension in the gas availability in the state.

Mr. Raha added that to materialize the President’s vision of ONGC going beyond Oil and Gas to enable the nation attain Energy Independence by 2030, ONGC is also substantially engaged in Underground and Surface Coal gasification, for which ONGC would explore opportunities for Coal Gasification in Rajasthan.