Country’s largest gas marketing and distribution company GAIL India may take over marketing of natural gas from ONGC entirely.
ONGC currently supplies gas directly in isolated pockets of India, mainly in Gujarat and Assam, which contributes around Rs 100 crore to ONGC’s total marketing revenues.
In May 1992, gas pipelines and marketing functions related to natural gas were transferred by ONGC to GAIL. However, there are certain isolated pockets where ONGC continues to be the marketing agency.
When contacted a GAIL spokesperson refused to comment on the issue. However, sources close to the development say the proposal is pending at ministry level.
"Gujarat's share in marketing of ONGC gas is about Rs 75-80 crore while Assam region contributes about Rs 20 crore," sources said.
The recent rise in gas prices is believed to have drawn GAIL’s attention to these regions and it has proposed to take over direct marketing of gas from ONGC entirely.
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Ankleshwar and Bharuch industrial areas are the major areas in Gujarat where ONGC markets gas directly while in Assam it supplies to the tea gardens.
An ONGC official said even if the Centre approves this move, it will not make much difference to the company as the marketing of gas contributes a very small portion of its overall turnover. This might however lead to some shifting of manpower at ONGC, said sources close to development.
Earlier this year, GAIL India had signed contracts for taking over marketing of natural gas produced from Panna-Mukta and Tapti gas fields.
GAIL had proposed to buy entire 17 million standard cubic meters per day of gas produced from the fields. It had signed contracts for sale of the gas to consumers, including RIL at the Government approved price of $5.7 per million British thermal unit.