Thirty bid documents sold so far.
The Petroleum and Natural Gas Regulatory Board (PNGRB) will open the bids for the first phase of the city gas distribution network project by March 15.
The board has so far sold around 30 bid documents. The deadline for submission of bids is March 3.
In the first phase of the project, the board has invited bids for seven cities, including Kakinada, Mathura, Bhopal, Sonepat, Ghaziabad, Sahdol and Kota. Four companies, including GAIL India, Gujarat Gas, Great Eastern Energy Company and Reliance Industries Ltd (RIL), have submitted Expressions of Interest (EoIs) for these cities so far.
Even as the board expects that existing players in city gas distribution could score in this round of bidding, it is also concerned about the gas supply for these projects.
| FIRST-PHASE FACTS |
| * Bids to be opened by March 15 |
| * 30 bid documents sold so far |
| * Deadline for submission of bids is March 3 |
| * First phase will cover 7 cities |
| * Around Rs 400 crore investment required in each city |
The government gives priority to critical sectors like fertilisers and power for supply of gas.
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The board has therefore written to the Ministry of Petroleum and Natural Gas to ensure 5 million standard cubic metres per day (mscmd) gas for CGD every year.
“Within three months of winning the bid, the successful bidder will have to secure a firm tie-up for gas supply. While the existing players in the field could manage to secure it, we are worried about the new entrants,” said PNGRB Chairman L Mansingh.
The board has requested the government to lay down guidelines for allocation of gas in such a manner that it is available to the successful bidder within a year.
On an average, each city will require an investment of around Rs 400 crore to set up the gas distribution network.
Mansingh feels that the ongoing global economic crisis will not deter new players from entering the business. “It’s a lifetime opportunity for any player. Recession or no recession, it’s a business to be in,” he said.
The second phase of the project will cover 14 cities, the bidding for which will commence as soon as the initial process for the first seven cities is over.
The PNGRB expects the city gas distribution network to spread to 100 cities by the end of the Eleventh Five-Year Plan (2012). Currently, around 10 cities have piped gas networks for domestic use.