IOC to enter gas pipeline business
The state owned oil marketing companies are exploring the new avenues for revenue as traditional sources such as sale of petrol, diesel and LPG are subject to government approvals. Largest OMC Indian Oil Corp (IOC) has decided to join the race for the trunk gas pipeline business. This segment of business has so far been dominated by a purely gas marketing and transportation company, GAIL India and Reliance Industries Ltd.
The Petroleum and Natural Gas Regulatory Board (PNGRB) opened the technical bids for the Mallavaram (near Kakinada in Andhra Pradesh) Bhopal-Bhilwara (Rajasthan) Vijaipur (near Guna in Madhya Pradesh) pipeline. GSPL, a subsidiary of Gujarat State Petroleum Corporation Ltd (GSPCL), which has struck gas in the KG basin, had originally proposed this pipeline to transport its gas. IOC has partnered with Gujarat State Petronet Ltd (GSPC) for this project. The only other bid was from GAIL India. IOC chairman B M Bansal said that the company was planning to bid for all three trunk pipelines for which bids were being invited.
“We will evaluate the technical bids first and then decide on the financial bids. The winner will be declared after three weeks,” said a senior Board official. The Board has been mandated by the government to rapidly expand the domestic gas pipeline network. At present, the bulk of gas consumption is accounted for by the western and northern states, while the eastern and southern states are lagging due to low pipeline density. The government is keen to expand the network to bring down the considerable inter-state disparity in gas consumption.
With the recent natural gas find in the eastern offshore KG basin, indigenous production is set to double and natural gas to emerge as an important source of energy. LNG infrastructure in the country is also being expanded. Current domestic gas production is estimated at about 160 mscmd and is set to increase, with a production ramp up by RIL’s KG-D6 block from 62 mscmd at present to 80 mscmd later. Business Standard
Leave your response!