Financial Daily from THE HINDU group of publications
Wednesday, Aug 11, 2004
Industry & Economy
Logistics - Infrastructure
GAIL plans Rs 4,500-crore gas pipeline to connect UP, Bengal
Kolkata , Aug. 10
GAIL (India) Ltd plans to build a Rs 4,500-crore gas pipeline from Jagdishpur in Uttar Pradesh to Haldia in West Bengal. The 870-km-long pipeline with a capacity to carry 20 million cubic metres natural gas per day will serve as one of the 15 "limbs" of the proposed national gas grid and will be connected with the Hazira-Bijaipur-Jagdishpur (HBJ) and Dahej-Hazira pipelines.
The detailed feasibility report on the pipeline is being prepared. Detailed route surveys are underway and commissioning will start in October this year. The project will be implemented in 2006.
Nominated as a preferred buyer of gas produced from the A1 block in Myanmar and having finalised picking up a stake in A3 block along with ONGC Videsh Ltd (OVL), GAIL is also in the process of finalising the plan to bring gas from Myanmar to West Bengal. Several options, including a 500-km deep-sea pipeline in international waters, are being considered.
Addressing a press conference on Monday, the GAIL Chairman-cum-Managing Director, Mr Proshonto Banerjee, said, "West Bengal is most strategically located to exploit the emerging possibilities in natural gas."
GAIL is also pursuing exploration and production activities in blocks 26, 24 and 7 having a combined acreage of over 18,000 sq km in the Mahanadi Basin and Bay of Bengal. The blocks were awarded under the New Exploration Licensing Policy (NELP) to consortia of which GAIL is a member.
"Gas is already visible here. The data acquisition and drilling plans have been finalised and drilling activities in block 26 will start at the end of monsoon this year," Mr Banerjee said.
Not against private participation
On the recent controversy relating to the possible opening up of the inter-State gas pipeline sector to private participation, the Chairman said, "There are already half a dozen gas transmission companies in the country and GAIL is not necessarily enjoying a monopoly."
However, he clarified that just like power transmission, national or inter-State gas transmission had largely been left in the hands of a state-owned company primarily to ensure optimal use of the method and avoid complications regarding real time management of demand and ensuring interests of the user groups.
"But for the issue of safe handling which occupies a substantial portion of the gas transmission system, multiple participation in the national grid passing through states may create a situation where there will be clashes of interests between the participants over servicing of customers."
While tier-II and tier-III gas transmission which are necessarily intra-state may be thrown open to private players, competition at the tier-I level may lead to sub-optimal use of natural gas in a developing country such as India.
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