New Delhi: Delhi Government has sought the intervention of Prime Minister's Office to help get natural gas for its Bawana power plant following refusal of Reliance Industries Ltd to supply the fuel for the project built at a cost of around Rs 4,500 crore.

Chief Secretary P K Tripathi had a meeting this week with officials of PMO seeking resolution of the matter at the earliest as Delhi has a huge demand-supply gap in power.

"We approached the PMO to seek supply of gas for the plant. The PMO indicated that the issue will be resolved very soon," a top official of Delhi Government informed.

The Centre had allocated 0.93 million cubic meters per day of gas (mmcmd) from Reliance's Andhra offshore KG-D6 fields for the Bawana plant for 2009-10 and 2010-11.

But Pragati Power Corp, the Delhi government entity running the plant, could not sign the Gas Sales Purchase Agreement with Reliance Industries Ltd on time since its power project was delayed.

Pragati Power after synchronising two gas-fired turbines of 250 MW each in April approached Reliance to sign the contract.

But Reliance said it was in no position to sign any fresh contract since output from its field has dropped to about 47 mmcmd, far less than about 58 mmcmd for which it has already signed supply contracts.

The 1500 MW capacity Bawana power plant is being built by the Delhi Government at an investment of about Rs 4,500 crore and three turbines out of the total six have been already synchronised.

The construction of the third turbine has been completed this month. These three turbines have a combined capacity to produce 750 MW of power and they were lying unused due to
non-availability of gas.

RIL sells KG-D6 gas to users like fertilizer units and power plants at government-fixed rate of USD 4.2 per million British Thermal Unit.

In absence of KG-D6 gas, the only option left for Bawana is to use imported LNG that will cost three times the price of Reliance gas.

Pragati Power has already told the Centre that running the Bawana plant in open cycle with liquefied natural gas (LNG) would be "highly uneconomical".

LNG, sourced at Dahej in Gujarat, can be supplied by state gas utility GAIL India Ltd but will cost around USD 12 per mmBtu.

"We are hopeful of a satisfactory resolution of the matter," said the official.

The Bawana plant's foundation stone was laid by Prime Minister Manmohan Singh in March 2008. The plant was scheduled to be ready well ahead of last year’s Commonwealth Games in October but missed the deadline.

Delhi Power Corporation has signed agreements with Bharat Petroleum Corporation, GAIL and Indian Oil Corporation for supply of two million standard cubic meters per day of gas
each to fire the power station.

The power demand in the city has been increasing gradually and it had touched an all-time high of 4,994 MW on June 24.

Currently, Delhi's power demand ranges from 4,100 MW to 4,900 MW, depending on the weather condition.

The city gets 2,400 MW from central quota, while nearly 1,000 MW is produced by Delhi's own electricity generating stations.

As per projection by Central Electricity Authority, the power demand in Delhi will jump to 8,700 MW by the year 2017.

The city government plans to increase its own generation to 4,100 MW in the next five years.