The board of Ratnagiri Gas and Power Pvt. Ltd. (RGPPL), putting end to all speculations, has approved the proposal of firm to buy gas from Reliance Industries Ltd.'s (RIL) K-G basin.

Earlier, one of the promoters of RGPPL opposed the deal due to sourcing cost and ongoing dispute between the NTPC and RIL, still pending with Bombay High Court.

The firm has signed two separate agreements with Reliance Industries' gas transportation arm, Reliance Gas Transportation Infrastructure and GAIL. An official of Ratnagiri Gas said, "After completing formalities in the next couple of weeks, the power plant would start receiving a gas supply of 2.7 million metric standard cubic meters per day
(mmscmd) from RIL's KG-D6."

RIL would supply gas from KG basin on the government fixed price of $4.2 per million metric British thermal unit (mmBtu) besides an additional $1 for transportation charges and taxes.

The 2100 MW Dabhol plant, India's first gas-based power project, is expected to completed by the end of this year to achieve its full generation capacity. It would supply power to Maharashtra, currently, facing deficit of at least 5,000 megawatts of power.