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Gas Production Delayed from GSPC's Fields on Demands for Premium Justified ?

News

Nearly a year after beginning trial gas production and investing $3.4 billion, Gujarat's GSPC is yet to start commercial production from its Deen Dayal discoveries in KG basin. The company wants applicability of of premium announced for future gas discoveries, to even existing difficult ones. 

Source:ET

SNP Insight 

The clause of premium on difficult discoveries is applicable for the newer ones as per the New Gas Price Guidelines 2014. However reiteration of the demand for the same by GSPC has put the production of gas on back foot. Any further delay in the production will not only hurt the Company's balance sheet but in turn further dampens investor's interest in the sector.

 

Source: SNP Infra Research