GAIL in JV with HPCL for gas projects in Rajasthan

Mumbai, May 18: Gail India Ltd and Hindustan Petroleum Corporation Ltd (HPCL) have signed a Joint Venture (JV) agreement for City Gas Distribution projects in Rajasthan.

The Joint Venture company will take up City Gas Distribution projects in Rajasthan and enable use of Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) in cities of Rajasthan for automotive and domestic use. The Joint Venture company will start its operations in Kota, for which the Detailed Feasibility Report (DFR) has already been prepared by the company. The company's Vijaipur-Kota pipeline is already operational and the Kota city gas project will source its gas though this pipeline, a company statement said here today.

The agreement was signed at the Company's office by Company Director (Business Development) A K Purwaha and HPCL Director (Marketing) S Roy Choudhury, in the presence of Company CMD Dr U D Choubey and HPCL CMD Arun Balakrishnan, and senior executives of both organizations, the company informed the BSE.

Company CMD Dr U D Choubey expressed great pleasure in having HPCL as a JV partner. He said, ''City Gas Distribution will be the next high growth areas in gas markets in future and the next decade will be the decade of City Gas Distribution.'' Dr Choubey recalled the success story of Bhagyanagar Gas Ltd, the GAIL-HPCL JV in Andhra Pradesh, and hoped that the JV company for Rajasthan would blaze a similar trail of success.

Emphasizing that city gas distribution is going to be very competitive business, he called upon the officials of the two companies to move fast and expedite further implementation of the city gas project in Rajasthan to ensure that the Joint Venture fully exploits the first mover advantage.

The new Joint Venture will have 22.5 per cent equity holding each by the company and HPCL, five per cent by the State government or its nominee and 50 per cent by strategic Investors / public / financial institutions.

This will be the third Joint Venture of the Company and HPCL and the ninth Joint Venture of the company for city gas distribution projects in India.

The two companies have set up Bhagyanagar Gas Ltd and Avantika Gas Ltd for city gas distribution projects in Andhra Pradesh and Madhya Pradesh respectively, the statement added.

UNI