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Benign LNG prices can fuel gas-based power. Spoilers: unyielding banks, flabby pipeline infra

Stranded gas-based power plants should be able to come out of darkness now, with LNG trading below USD5 per mmbtu. But that’s easier said than done as companies don’t have the capital to put the unused plants back in action, and banks are not lending.
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2 Sep 2019 8 Mins Read 4 comments
The Sugen Mega Power Project at Kamrej, on the outskirts of Surat Getty Images
The Sugen Mega Power Project at Kamrej, on the outskirts of Surat
In 2005-2006, when the Indian power sector finally went for what could potentially mollify frowning environmentalists, boardrooms across electricity-producing companies lit up with the possibility of higher margins. Gas-based power plants suddenly became a hot topic of discussion among industry bosses — 50%-60% less carbon emission and nearly half the generation cost compared to coal-fired power units, and a brave
Bassein fields. ONGC’s gas production has hit an all-time high of about 75 mmscmd, as it is in the process of increasing domestic gas production. Senior officials of the company estimate that there could be an increase of 24 mmscmd-25 mmscmd in next one-two years. The more the merrier. ( Graphics by Abdul Shafiq and Mohammad Arshad)
In 2005-2006, when the Indian power sector finally went for what could potentially mollify frowning environmentalists, boardrooms across electricity-producing companies lit up with the possibility of higher margins. Gas-based power plants suddenly became a hot topic of discussion among industry bosses — 50%-60% less carbon emission and nearly half the generation cost compared to coal-fired power units, and a brave Bassein fields. ONGC’s gas production has hit an all-time high of about 75 mmscmd, as it is in the process of increasing domestic gas production. Senior officials of the company estimate that there could be an increase of 24 mmscmd-25 mmscmd in next one-two years. The more the merrier. ( Graphics by Abdul Shafiq and Mohammad Arshad)

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