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Industrial Users Feel Heat of Gas Price Rise

  • It is the turn of the industrial users in Surat, Ankleshwar and Bharuch to feel the pinch of price hike in natural gas.Following a steep rise in the prices of industrial gas supplied to the industries across the state by other city gas distributors (CGDs) like GSPC Gas Company, a subsidiary of the state-run Gujarat State Petroleum Corporation ( GPSC) and Adani Gas, Gujarat Gas Company Ltd (GGCL) has increased the gas price by Rs 4.077 per standard cubic metre (SCM) at Rs 22.47 per SCM.Industry sources said the company issued letters to all its clients in Surat, Bharuch and Ankleshwar on Friday informing them about the price hike of Rs.4.077 per scm, which will come into effect from January 1, 2012.
  • Pramod Choudhary, president of South Gujarat Textile Processors Association (SGTPA), said, "It is going to be a tough time ahead for the textile sector due to the increase in gas price. Survival of the textile process houses will be difficult. We may have to increase the job charges by around 25% in order to pass on the price burden."According to Choudhary, the industry is already passing through a tough phase due to steep increase in the prices of chemicals and dyes, fall in the demand of finished fabrics because of drop in exports and rupee appreciation.CGD sector sources said the price revision has come from almost all the distributors operating in Gujarat. This is because supply from the domestic field in the country is decreasing, resulting in procurement of regassified liquefied natural gas (RLNG) at higher cost.
  • Last month, the state-run GGCL increased the gas price supplied to industries from Rs 21.80 per SCM to Rs 26.70 per SCM and for the commercial users such as hotels and restaurants from Rs 29.10 per SCM to Rs 42 per SCM. Adani Energy Ltd (AEL) has also increased the price of gas supplied to industrial users to Rs 29 per SCM.If one has to compare the existing price structure for the end-users in the industrial, commercial and CNG segment, Surat, Bharuch and Ankleshwar are sitting on a price benefit.

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