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Essar took to twitter to inform about starting off gas supply to state-owned GAIL India. Ruia family-owned Essar inked a 15-year contract in August to supply all of its coal bed methane (CBM) production from Raniganj East block to GAIL. The Raniganj East block is predicted to reach peak coal bed methane (CBM) production of 2.3 million standard cubic metres per day.
After the submission of winning bid by GAIL, Essar Oil & Gas E&P has agreed to supply 2.3 mmscmd of its entire coal bed methane (CBM) production from the Raniganj project in West Bengal, India. The gas sale and purchase agreement (GSPA) has a term of 15 years. In its bid, GAIL offered the payment of gas prices associated to the average daily price of three months of Brent crude.
Essar Oil subsidiary, Essar Oil and Gas Exploration and Production (EOGEPL) has entered into a gas sale and purchase agreement (GSPA) with state-run GAIL for a 15-year term. GAIL won the bid for the contract floated by EOGEPL. The deal will help monetize EOGEPL’s complete CBM production from the Raniganj East block. The Essar subsidiary has already concluded drilling of 346 out of the 500 CBM wells.