IPCL's bill for C2/C3-rich gas supplies to rise?

25-Jan-06

An increase in prices by ONGC for long-term supply of C2/C3 (methane-propane) rich gas to Indian Petrochemicals Corporation Ltd (IPCL) is expected shortly. The gain will be especially higher for C3, which will henceforth be linked to international prices. The deal awaits a formal agreement between the two, but it seems that IPCL is agreeable to pay US$4.6 per million British thermal unit for C2 supplies from its Uran processing plant. The C3 supplies, also from Uran, will be made at international prices linked to Platts pricing index of Saudi Aramco. As per the existing contract, ONGC does not charge separate prices for C2 and C3. The price for the bundled offer works out to be Rs 14,082.33 per ton for supply of 580 tons of C2/C3 a day. C3 generally records higher prices than C2. While methane is generally used for thermal power generation, propane is mixed with butane for producing LPG.