Gail To Spend Rs 1,500 Crore On Laying New LNG Pipelines

New Delhi, Sept 24: | Updated: Sep 25 2003, 05:30am hrs
Gail (India) Ltd has planned an investment of over Rs 1,500 crore in laying new pipelines for supplying liquefied natural gas (LNG) imported at Dahej to customers in North.

Disclosing this to reporters after a lecture series on hydrocarbons organised by the Confederation of Indian Industries (CII), chairman and managing director of Gail Proshanto Banerjee said Gail would lay Dadri-Panipat, Kota-Jodhpur and Jagdishpur-Phulpur branch pipelines on the main trunk Hazira-Bijapur-Jagdishpur (HBJ) pipeline.

These will be in addition to the $612 million Dahej-Vijaipur and $294 million Dahej-Uran gas pipelines, the construction on which is nearing completion.

On the crucial issue of LNG pricing, Mr Banerjee hoped regassified LNG from Dahej would be delivered at just over $3.5 per million BTU (British thermal unit), around the same price which major customers in power and fertiliser sectors are willing to pay for LNG.

A team of senior officials from Rasgas is visiting India later this month to renegotiate the price at which it will sell LNG to Dahej terminal of Petronet LNG Ltd (PLL), Mr Banerjee said, adding that during the same time Gail, IOC and BPCL will sign the gas offtake agreement with PLL.

Gail would market 60 per cent of the 5 million tonne LNG arriving at Dahej while Indian Oil Corp (IOC) will take 30 per cent and the remaining 10 per cent would be sold to Bharat Petroleum Corp Ltd.

The 612-km Dahej-Vijaipur pipeline would have a capacity to evacuate 20 mmscmd while the Dahej-Uran would transport 12 mmsmcd of gas, he said.

While Dahej-Vijaipur and Dahej-Uran gas pipelines will be synchronised with the arrival of LNG from Qatar in January 2004, the three other pipelines would take 2 years to complete, the time during which the Dahej terminal too would scale up to its maximum capacity of 5 million tonne (18 million standard cubic meters per day).