Financial Daily from THE HINDU group of publications
Tuesday, Aug 23, 2005
Mergers & Acquisitions
GAIL in talks for equity participation in Chinese cos for CNG projects
New Delhi , Aug. 22
GAIL (India) Ltd is pursuing equity participation in Beijing Gas Company and Beijing Jianggang Gas for implementation of compressed natural gas (CNG) projects in Beijing.
After bringing down vehicular pollution levels significantly through its project in Delhi and Mumbai, the company is now looking at Beijing, GAIL said in a press release here today.
China has decided to introduce CNG in Beijing for converting entire transport vehicles by 2008, before commencement of the Olympics. Currently, the number of buses and taxis in Beijing are 20,000 and 80,000, respectively.
During the recent visit of a high level GAIL team led by Mr Proshanto Banerjee, Chairman and Managing Director, discussions were held with China Gas Holdings Ltd for GAIL's participation in CNG projects of Beijing municipality area as well as in the six suburb districts of Beijing.
GAIL has also been offered three cities in Mainland China - Wuhu city in Anhui province, Huainan and Yichang cities in Hubei province for CNG projects.
The projects will be executed by joint ventures between GAIL and China Gas Holding Ltd, the company said.
Beijing Jianggang Gas is a joint venture formed by China Gas Holdings Ltd and Beijing Gas Company for supply of natural gas in the six suburb districts of Beijing.
While GAIL holds stake in China Gas Holdings, the latter has a 49 per cent stake in Beijing Jianggang Gas Company. Beijing Gas Company has got the concession to introduce CNG in municipality area of Beijing.
GAIL is looking at playing a crucial role in converting the mass transportation system of the city to CNG before the Beijing Olympics to be held in 2008, GAIL said.
GAIL and China Gas Holdings Ltd will also form master joint venture (50:50) for developing CNG projects in the existing as well as future projects of the Chinese company.
GAIL team has discussed issues related to master joint venture for CNG projects and the agreement is under finalisation.
Subsequently, the master joint venture will form a project company for CNG in each of the identified cities, which are serviced or would be serviced by China Gas Holdings Ltd, GAIL said.
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