Gujarat Gas rallies on pact with GSPC for gas supply

MUMBAI: Shares of Gujarat Gas ( GGCL) gained momentum after the company signed a Memorandum of Understanding (MoU) with Gujarat State Petroleum Corporation ( GSPC) for long-term gas supply.

As per the MoU, GSPC has agreed to supply 0.85 mmscm of gas per day to GGCL from January 01, 2014 to June 30, 2025. Price of gas will be determined in the relevant Gas Sales Contracts and it is expected to be formula based. The MoU is effective till the December 31, 2013 or the signing of the relevant GSCs, whichever is earlier.

“Out of around 2.8 mmscm of gas per day used by GGCL’s customers currently, nearly 50% is RLNG which is largely sourced through medium term contracts or from spot markets. Under the MoU with GSPC, we will be able to source assured supply of 0.85 mmscm of RLNG per day for 11.5 years,” said Sugata Sircar, Managing Director, GGCL.

Gujarat Gas Company distributes approximately 2.8 mmscmd of natural gas to about 404,000 industrial, commercial and domestic customers through its pipeline network and CNG to over 200,000 vehicles through 56 retail outlets.

At 09:40 a.m.; the stock was at Rs 207.45, up 4.38 per cent, on the BSE. It touched a high of Rs 216.55 and a low of Rs 203 in trade today.