| Gail has spent about Rs 500 crore on this 600 km pipeline project, which was completed last fiscal. |
| Although the work on the pipeline was completed nearly a year ago, the oil companies were not ready to use this facility. After a long time Hindustan Petroleum Corporation (HPCL) has come forward to use the facility from April. |
| "Three oil companies, ie, HPCL, Indian Oil Corporation and Bharat Petroleum Corporation have agreed to use this pipeline to transport LPG stocks to their respective bottling plants, but are yet to gear up to use this facility. This fiscal we expect to earn nominal revenues only," Rakesh Kumar Garg, general manager, GAIL, told Business Standard. |
| The pipeline which has a transport capacity of 3,500 tonnes per day at present has a capacity utilisation of only 10 per cent. As per the transport agreement signed with the oil companies Gail is charging Rs1.50 per tonne per km to transport LPG. |
| "At this rate, and with these kind of volumes Gail 's earnings on these project will be ranging between Rs15 and Rs 20 crore only this fiscal," Garg said. "In the next fiscal, we expect to transport around 1,500-2,000 tonnes per day through this pipeline," Garg said. |
| The three oil companies are setting up six LPG bottling plants at Vijayawada and Secunderabad. HPCL's Vijayawada bottling plant is the only one to be commissioned so far while the remaining five plants are expected be ready by the end of this fiscal. |
| "Once these plants come into operation, our pipeline capacity utilisation will increase significantly," he said. |
| HPCL has been using this pipeline for LPG transport since April and GAIL has been transporting between 300 and 400 tonnes of LPG from Vizag to Vijayawada. |
| By August the LPG transport volumes will go up to 900 tonnes per day, with HPCLs second LPG bottling plant expected to be ready by August, Garg revealed. |
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