State-run gas monopoly GAIL India today said it will borrow $134 million from Export Credit Agency to fund truncated capital expenditure planned for 2009-10 fiscal.
GAIL may spend Rs 5,500 crore next fiscal as against the previous estimate of Rs 7,000 crore on slower expansion of its pipeline network and reduce expenditure on exploration, company Director (Finance) R K Goel told reporters here.
"The US Exim loan will cost us less than 8 per cent in interest cost," he said, adding the company also planned to take Rs 1,500-crore debt from Oil Industry Development Board (OIDB).
Of the borrowing planned from OIDB, the company board yesterday gave in-principal go-ahead for Rs 1,000-crore debt.
Goel said GAIL's current year capital spending is likely to be around Rs 2,500 crore, as against projected Rs 3,200 crore on slower pipeline expansions. "Till December, we had spent Rs 2,000 crore and another Rs 500 crore is expected to be invested by March-end."
The OIDB loan, he said, would be linked to the floating interest rate of G-Sec or Government Securities. "G-Sec currently is at 8.63 per cent."
Geol said the liquefied natural gas (LNG) import terminal at Dabhol power plant, where GAIL is an equal owner with NTPC, would be mechanically complete by next month end. "It will take another 30 days to commission it."
GAIL was looking at sourcing a spot cargo of LNG to commission the 5 million tons a year facility. However, without the breakwater, which is likely to be build by 2013, LNG carrying ships would not risk docking at Dabhol.
Besides, Ratnagiri Gas and Power, the company owned by GAIL and NTPC that runs the nation's largest gas-fired power plant, does not have tug boats needed for piloting LNG carriers to the docking berths.
