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Gas stocks surge up to 17% on reports RasGas may modify deal with Petronet

Contract renegotiation may provide significant earnings impetus to GAIL and remove the key overhang for Petronet.

The benchmark BSE Oil and Gas index was the top sectoral gainer and rose nearly 2 per cent to 9165.94. Photo: Reuters The benchmark BSE Oil and Gas index was the top sectoral gainer and rose nearly 2 per cent to 9165.94. Photo: Reuters

Shares of gas stocks such as GAIL, Petronet LNG, Gujarat Gas, Indraprastha Gas and Gujarat State Petronet rallied up to 17 per cent in trade on Friday following news reports Ras Gas Company (RasGas) is ready to modify sales and purchase agreement (SPA) with Petronet.

Petronet has a 25-year deal with Qatar's RasGas to buy 7.5 million tonnes of LNG annually.

Shares of Gujarat Gas ended 6 per cent up after surging 17.74 per cent to Rs 570.75 in intraday trade on the Bombay Stock Exchange (BSE).

The stock of GAIL ended 10 per cent up at Rs 348.80, while Petronet LNG closed 6.79 per cent higher after hitting an intraday high of Rs 224.60, up 8.97 per cent, on BSE.

Stocks of Indraprastha Gas and Gujarat State Petronet rose 6.86 per cent to Rs 496 and 6.10 per cent to Rs 133, respectively.

Gas stocks were the top gainers in BSE 'A' group, while the benchmark BSE oil and gas index was the top sectoral gainer and settled the day 2.05 cent higher.   

Petronet and RasGas have agreed 'in principle' to postpone $1.5 billion of penalties for the shortfall in LNG off-take, said Kotak.

Contract renegotiation may provide significant earnings impetus to GAIL and remove the key overhang for Petronet. India lifted 30 per cent less volume, till July this year, under long-term Qatar LNG deal.

(With inputs from Reuters)