UPDATE 1-India's Reliance signs gas deal with fertiliser cos

By Nidhi Verma

NEW DELHI, March 27 (Reuters) - India's Reliance Industries (RELI.BO) on Friday signed deals with fertiliser firms to sell about 15 million standard cubic metres a day (mmscmd) of gas from its giant field from the middle of next month.

"We are signing 15 contracts with 12 companies and the volumes are about 15 mmscmd," P.M.S. Prasad, the chief executive of Reliance's oil and gas business told reporters before signing the contracts.

The company plans to raise output from the deep-sea field in the Bay of Bengal by 10 mmscmd a month, reaching peak production of 80 mmscmd by the end of this year, he said.

Supply from India's biggest gas discovery is expected have a far-reacing impact on India's energy sector. For stories on analyses on the implication, click [ID:nDEL421347]

Fertiliser firms will pay Reliance a marketing margin of 13.5 cents per mmBtu for the gas, said Satish Chander, Director General of Fertiliser Association of India.

The margin is in addition to the government-approved price of $4.2 per mmBtu for the gas.

The firms include Chambal Fertilisers (CHMB.BO), Indian Farmers Fertiliser Cooperative Ltd, Krishak Bharati Co-operative Ltd, Gujarat Narmada Valley Fertilizers Co Ltd (GNFC.BO), Gujarat State Fertilizers and Chemicals (GSFC.BO), Nagarjuna Fertilizers (NGFR.BO), Tata Chemicals (TTCH.BO), and Rashtriya Chemicals and Fertilizers Ltd (RSTC.BO).

The government has said fertiliser plants will get gas on a priority basis from Reliance.

Several customers are keen to buy natural gas, which is in short supply in Asia's third-largest oil consumer. India imports about 70 percent of the oil it consumes. (For our special online coverage of the impact of Reliance's gas field on India's energy sector please click: here ) (Editing by John Mair)