Vedanta invites bids for natural gas from its Raageshwari gas field

30 Dec 2022 , 11:30 AM

Vedanta Limited announced that it has invited bids for natural gas from its Rajasthan block at a floor price of $9.57 per mmBtu. According to the e-auction document, Vedanta intends to sell 3 million metric standard cubic metres per day (mmscmd) of gas in an auction scheduled for January 18. 

The supply will be available for a year starting on April 1 from the Raageshwari gas terminal in Barmer, Rajasthan.

The floor price will be one dollar higher than the domestic formula price, which is updated every six months and currently stands at $8.57 per mmBtu. The sale price will be the lower of the Platts LNG West India marker or 15.25% of the average Brent price plus a bidder-specified premium.

The sale price would be $12.5 per mmBtu at the current Brent price of $82 per barrel and no premium. Vedanta has complete pricing control over the gas it produces from its Rajasthan block.

The majority of the country’s producing fields do not have pricing freedom, and their gas is sold at the domestic formula price. Currently, gas from difficult fields can be sold at market rates, subject to a cap of $12.46 per mmBtu.

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