Agreement signed for natural gas supply to PPN

Chennai, Apr 28 (UNI) An agreement between Hindustan Oil Exploration Company Limited (HOEC) and PPN Power Generating Company, the largest independent power producer in Tamil Nadu, was signed today for supply of natural gas to meet the power requirements of PPN.

The agreement was signed between HOEC Joint Managing Director Manish Maheshwari and PPN Managing Director S Narayanan, in the presence of Chief Minister M Karunanidhi and Electricity Minister Arcot N Veerasamy.

The PPN, with an installed capacity of 330.5 MW, operates a combined cycle power plant at Pillai Perumal Nallur in Nagapattinam district. This plant was designed to operate on either natural gas, or Naphtha or on a mixture of natural gas and Naphtha.

The plant, which was commissioned on April 26, 2001, sells its entire power generated to Tamil Nadu Electricity Board. The plant generates 2600 million units per annum at 90 per cent Plant Load Factor (PLF).

An off-shore gas field was situated about 50 km North East of the power plant along the coast of Puducherry. It is now proposed to avail gas supply from this field through HOEC, which owns and operates this field.

The PPN would start receiving natural gas from this field before the end of 2008.

The price of Naphtha which was Rs.14,780 per metric tonne in April 2001, now stood at Rs 38,500 per metric tonne. The price of natural gas as per the gas supply agreement will be 3.75 US Dollars per Million Metric British Thermal Units (MMBTU).

A total of 113.620 million MMBTU of natural gas would be supplied to PPN from this field.

The variable cost of Rs 6.67 per unit using Naphtha at its current price level would be reduced to Rs 1.26 per unit when switched over to natural gas. The total savings in fuel cost will be Rs 1,400 crore at 90 per cent PLF per annum to TNEB.

UNI