ONGC owns significant natural gas reserves in the North Eastern state of Tripura. However, these natural gas reserves are yet to be commercially developed due to low industrial demand in the North-Eastern region. The complexities of logistics and attendant costs limit the economic viability of transportation of gas to other parts of the country where gas is in deficit. In order to optimally utilise the gas available in Tripura, ONGC decided to establish a 726.6 MW Combined Cycle Gas Turbine (CCGT) power plant close to its gas fields in the state of Tripura (“the Project”) along with an associated power transmission system from the project site to Bongaigaon in Assam.
- Optimal utilization of Gas ReservesPower generation at wellhead and transmission of power implies better economics vis-à-vis the option of gas transport and power generation at load center. Given that power sector is the single largest consumer of gas in the country, the proposed project will obviate the necessity to transport gas to demand centers in North India. The project provides a market to ONGC for its gas while OTPC achieves the benefit of long-term gas pricing mechanism devoid of traditional risks of oil price linkage or market volatility.
- Monetisaton of Idle Gas Assets While maintaining focus on its core business of exploration and production (E&P) of oil and gas, ONGC wishes to integrate forward to monetize its natural gas assets in the region through establishment of the proposed project.ONGC already operates captive power generation capacity and possesses requisite competencies to establish power generation facilities.
Tripura (located in the North Eastern part of India) is endowed with commercially exploitable gas resources that have not been commercially exploited till date on account of various factors. These include lack of adequate road/rail infrastructure, weak transmission infrastructure and vast distances to load centres in northern & western part of India. Therefore, the development of gas based power generation capacity has not materialised in the region. Inadequate power generation capacities have in turn affected industrial development in the region.