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ONGC urges TN to use natural gas reserves for power sector

Our Bureau

It was cheaper to set up small capacity power plants at the gas field itself rather than transport the gas through pipeline to a larger sized power generating facility. Nine gas fields in the State had been closed due to lack of demand for gas.

Chennai , Nov. 17

OIL and Natural Gas Corporation Ltd has asked the Tamil Nadu Government to take steps to use the significant quantity of proven natural gas reserves lying idle in the State for want of users, especially from the power sector.

The corporation's Chairman and Managing Director, Mr Subir Raha, told the Chief Minister, Ms J. Jayalalithaa, during a meeting on Monday that the gas could be bought either by a Government nominated agency or the electricity board to generate power. The corporation itself could set up power plants, but this would require an agreement with the Government to sell the power. The Tamil Nadu Electricity Board is setting up a 90 MW gas-based power plant at Kuttalam using gas from the Cauvery basin and this is scheduled to begin generation early next year. More gas is available from isolated and marginal fields that are not connected to a pipeline, Mr Raha told a press conference.

He said that it was cheaper to set up small capacity power plants at the gas field itself rather than transport the gas through pipeline to a larger sized power generating facility. Nine gas fields in the State had been closed due to lack of demand for gas. The quantity of gas available and not being used was not provided.

The corporation had invited bids from service contractors to produce gas from two isolated fields in Tamil Nadu - at Attikadai in Nagapattinam district and in Neyveli. The contractor for the Attikadai field would be decided shortly while there were no bids for the Neyveli field. The Attikadai reservoir had reserves of 0.16 million tonnes and the Neyveli field 0.03 million tonnes (of oil equivalent gas).

Typically, these isolated fields could operate for seven to nine years at a given production rate. Laying pipelines was expensive and it was much easier to transport power than gas.

Mr Raha said the Government had also assured him that the production and exploration licences and the mining leases, which were pending, would be issued in the next two-three weeks. Six production and exploration licences and 15 mining leases were waiting for the State Government's approval.

He had told the Chief Minister that ONGC's cumulative investment in the State was about Rs 3,500 crore and another Rs 1,000 crore was to be invested during the Tenth Plan period (2002-07).

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