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Even as several power and fertiliser plants are suffering from insufficient availability of natural gas, they are averse to buy imported gas because of its unacceptably high price.
Natural gas-based power producers want a larger share of the domestically-produced cheaper gas, which is priced between $4.2 (RIL's D6 gas) and $5.73 per unit, which is far less than the price of imported gas in the spot market. It is learnt that the landed cost of gas is expected to be around $13 per unit. Further, the uncertain investment climate has reduced demand for imported gas, reports suggest.
Therefore, GAIL India, which is making arrangement to import 7 million tonne of liquefied natural gas (LNG) from US into India starting 2017-18 is finding difficulty to secure domestic buyers for the gas.
BC Tripathi, Chairman of GAIL is quoted as saying that in the absence of firm commitments from anchor consumers, the firm would be forced to trade it in international markets.
Tripathi claims that the seven million tonne gas, mainly sourced from the US, is competitively priced in comparison to other recent long-term LNG being procured from overseas.
It may be recalled that after concluding deals with US firms, Gail planned to bring 7 million tonne of LNG every year to the gas-starved Indian market.