The Union Government is considering amending the gas allocation policy that says that state-owned companies cannot start project before securing fuel linkage.

As per the Department of Public Enterprise guideline, state-owned companies cannot order equipment and begin construction activities before securing fuel linkage for the projects. Private developers can begin work even before getting gas linkage putting them ahead in terms of work done, a key consideration in gas linkage, putting the state-owned power developers at a disadvantage.

The amended rule is likely to benefit NTPC, as several of the proposed gas based power projects are stranded. Some of the projects to benefit are expansion projects of 1,000 MW each at Badarpur (Delhi), Auraiya (Uttar Pradesh), Faridabad and Dadri (Haryana), and a 2,000 MW expansion project of Ratnagiri Gas and Power.