Guwahati, Sep 29 (IANS): The Assam government is planning to use associated gas, which were hitherto being burnt, for generating power, Industries and Power minister Pradyut Bordoloi said Moday.

He said the state government is going to set up a new project, which will use the associated gas for generating of power.

Associated gas is a form of natural gas which is found with deposits of petroleum, either dissolved in the oil or as a free "gas cap" above the oil in the reservoir. This type of gas is generally released as a waste product from the petroleum extraction industry. Due to the remote location of many oil fields, either at sea or on land, the gas is simply burnt off in gas flares.

The project, to be implemented by two state public sector units -- Assam Power Generation Corporation Limited (APGCL) and Assam Gas Corporation Limited (AGCL) -- is likely to cost around Rs.300 crore and would be completed within next two and a half years time.

The gas-based project is likely to generate 50 MW of power after completion, the minister said.

"I am happy to inform that the ONGC has agreed to let us use the small pockets of associated gas in its oil fields, which are located mainly in Golaghat and Jorhat districts of Assam. These associated gas will be pulled in to a central location where it would be used to generate power," Bordoloi said, adding that this is for the first time in Assam that associated gas will be used to generate power.

"We are informed that we can collect more than 2 lakh standard cubic metre of associated gas every day, which could in turn generate 50 MW of power," he said.

While the AGCL will lay the pipeline to collect and pull the associated gas, the APGCL will generate the power from the collected gas, he said.