India will buy the entire produce for the next 15 years from Essar Oil’s coal bed methane (CBM) block of Raniganj East in West Bengal.
The state-run gas firm outbid three rivals to win the rights to buy up to 2.3 million metric standard cubic metres per day (mmscmd) of CBM from Essar at a crudelinked price which works out to $6.492 per million metric British thermal unit (mmBtu) on gross calorific value basis at an oil price of $60 per barrel, according to the auction details available on Essar’s website.
GAIL confirmed it had won the auction.
The prices are to be revised every month and are linked to trailing three-month average price of crude oil. The price discovered in Essar’s auction is similar to what Reliance Industries received in its CBM auction last year. Read More…