GAIL plans Rs 4000cr Haldia gas pipeline

GAIL India has decided to invest Rs 4,000 crore in building a gas pipeline connecting Jagdishpur in Uttar Pradesh to Haldia in West Bengal, even as the monopoly of the state-run company for laying pipeline has come under doubt following reports that the Centre could allow multiple players in gas transmission business in India.

Proshanto Banerjee, chairman and managing director, said the rights of usage (RoU) was already with the company and it was going ahead with the plan to set up the 850km pipeline to feed the gas-starved eastern states.

"There is strong demand in the eastern region from industrial users in West Bengal, Bihar, Jharkhand. Moreover, we are also considering a spur line from there to Kolkata to feed this market," Banerjee told Business Standard.

This pipeline would be an extension of sort of the Hazira-Bijapur-Jagdishpur (HBJ) pipeline. According to the plan, more quantity of gas will be pumped at Dahej in Gujarat into the HBJ pipeline to feed the eastern market.

The development gains in significance for the fact that the government could allow multiple operators in building pipeline. However, GAIL is going ahead with its plan in building the Rs 20,000 crore National Gas Grid (NGG). "There is no official communication in place from the ministry. We have a draft guideline in place which said GAIL will be executing the NGG. So the company is going ahead with its plan and the proposed pipeline to connect eastern markets is part of that," Banerjee pointed out.

Apart from the LNG terminal at Dahej by Petronet LNG Ltd (PLL) where GAIL has a stake, the company is looking at few other sourcing options for the states of West Bengal, Jharkhand among others.

It is seriously looking at bringing the Myanmar gas from the A-1 offshore block, where GAIL and ONGC Videsh has combined 30 per cent stake, by pipeline. "We are also looking at the economics of LNG option," he added.