Summary
ONGC has been given an assurance by the Gujarat government that the national explorer will get at least $6/mmBtu for the gas from the Deen Dayal-West (DDW) block in the Krishna Godawari basin in the first year of production. The assured price will see staggered increments every year — it will touch $6.9/mmBtu in the fifth year and remain at that level during the remaining life of the asset. The move to offer a price guarantee is expected to help ONGC and state government-owned Gujarat State Petroleum Corporation (GSPC) to conclude the announced acquisition of the latter’s 80% stake in the asset by ONGC by March 31. Under a deal signed earlier, ONGC will pay debt-laden GSPC $1.2 billion ......