Indian Consortium Awaits PNGRB Authorization for Cross-Country Natural Gas Pipelines

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Researched by Industrial Info Resources India (Delhi, India)--A consortium led by Gujarat State Petronet Limited (GSPL) emerged as the frontrunner during bids in October last year for the laying of three cross-country natural gas pipelines, but it has yet to receive a letter of authorization from the Petroleum and Natural Gas Regulatory Board.

According to a senior GSPL official, the downstream oil industry regulator has not yet been able to grant authorization for the three pipeline projects due to a March 2010 interim order of the Supreme Court, which restrains the Board from taking any decision on gas distribution licenses.

GSPL, a subsidiary of the state-owned Gujarat State Petroleum Corporation Limited, along with Indian Oil, Hindustan Petroleum and Bharat Petroleum, won the rights for laying gas pipelines between Mallavaram and Bhilwara (1,585 kilometers), Mehsana and Bhatinda (1,680 kilometers), and Bhatinda and Srinagar via Jammu (740 kilometers).

"The next Supreme Court hearing is slated for August, but PNGRB is trying for an earlier date," the GSPL official told Projectmonitor. "The legal issue concerning PNGRB will be resolved soon. Grant of authorization is going to come through after that. The pipelines have to be completed within 36 months from date of issuance of the letter of authorization. We expect gas to flow through some parts within 24 months."

The three pipelines, covering the states of Andhra Pradesh, Maharashtra, Gujarat, Rajasthan, Madhya Pradesh, Haryana, NCR, Punjab, and Jammu & Kashmir will require a capital expenditure of approximately $2.71 billion. The total carrying capacity of the pipelines is expected to be about 85 million standard cubic meters per day of gas.

"So far, GSPL has been confined only to the state of Gujarat, but after the development of 4,000 kilometers of cross-country pipelines, the company will become a national player," said the GSPL official. At present, GSPL transmits over 35 million standard cubic meters per day of gas, including 12 million standard cubic meters per day of re-gasified LNG.

In future, GSPL plans to expand its grid to 2,200 kilometers across all 25 districts of the state, enabling industry, households and transportation to drive the benefits of environmentally friendly fuel.

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