The government has already agree to a ‘new’ price of $8.30 for 2014 – end of existing contract (not sure what month) but Niko & Reliance was trying to get this higher price before that….unsuccessfully. Government is desperately trying to replace $12 to 14 they are paying now for gas from LNG imports. $8.30 is the minimum & chances are that the new gas price will be 12 or more all depends on LNG price in 2014 since new price is referenced to that. In India gas is subsidized and is sold at grate discount to public from the premium purchase price which is LNG (up to $16/mcf).

As for this discovery; each Tcf is ~150 mmbbls equivalent so if this deeper find (high pressure-60,000kPa!!! & liquid rich) is as extensive as initial test suggest this could be $700 million plus net to Niko before even more wells are drilled.

G37