OIL & GAS

RIL prices CBM gas at $6 per mBtu, invites bids for sale

Reliance Industries Ltd on Wednesday sought bids from buyers for 0.82 million standard cubic meters per day of gas from its Sohagpur coal-bed methane block (west) in Madhya Pradesh, according to a notice inviting offer.

The gas has priced a minimum of $6 at the current oil price.

CBM is natural gas stored or absorbed in coal seams. India, with the world’s fourth-largest proven coal reserves, holds significant potential for CBM exploration and production. CBM gas is similar to natural gas, containing 90-95% methane.

RIL has sought bids for the supply of gas to industries as well as city gas distributors for one year beginning April 1, 2021.

RIL holds two adjacent CBM blocks SP (West) and SP(East) with an area of 995 square kilometers in the first round of CBM block bidding by the government of India in 2001.

“RIL invites offers from interested companies in accordance with the terms and conditions of the request for proposal (RFP) dated 23 February. The prospective bidders are requested to download the RFP and follow instructions,” said RIL in its notice inviting offer.

Users have been asked to quote a percentage of Brent crude oil price they will be willing to pay for the gas. RIL on its part has set 9.5% of Brent rate as the base or minimum price and asked bidders to quote higher than or equal to it.

“The gas produced from the block will be available for sale at the delivery point located at GGS !!, Tehsil Burhar, Sahdol, Madhya Pradesh from 1 April, 2021 subject to the terms of the gas sale and purchase agreement,” RIL said in the notice.

Source
Livemint
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