Reliance had on May 22 wrote to the oil regulator Directorate of Hydrocarbons that the post well head cost of the gas - the cost for flowing the fuel from the well through an undersea pipeline network to onshore terminal near Kakinada -worked out to $0.8945 per mmBtu.
B Ganguly, senior vice president (Commercial) of RIL said the per unit cost has been calculated after taking into account the per unit capex of post-well facilities, the production expenditure or opex and interest cost.
RIL will pay the government 5 per cent royalty after deducting this post well head cost from the gas sale price.
A company spokesperson declined comments but sources said the cost indicated did not include the investment RIL has made in exploration on the Block KG-D6, drilling of wells, well cost and putting up complex sub-sea production facilities.
Though RIL has not calculated the per unit cost of the development and production expenditure incurred on the field, rough estimates put the cost at around $2 per mmBtu. This together with the post well head cost would bring the total cost of producing natural gas from the nation's most prolific gas field at around $3 per mmBtu.