GSPC-RIL sign biggest ever gas transportation agreement

Gujarat State Petronet Limited (GSPL) and Reliance Industries Limited (RIL) have signed a gas transportation agreement to transport 11 MSMCMD of natural gas from Bhadbhut in Bharuch to RIL's Refinery and Petrochemical complex in Jamnagar.

Under the agreement, RIL has an option to increase the volume of gas up to 14 MSCMD. RIL would transport portion of its KG Gas from Kakinada through its East-West Pipeline and deliver the same to GSPL at Bharuch. For transportation of gas, GSPL would use its existing pipeline and develop new pipelines between Bharuch to Hadala and Rajkot to Jamnagar.

D J Pandian, MD, GSPCL, and PMS Prasad, President & CEO, Petroleum Business, RIL signed the agreements in the presence of Saurabh Patel, Minister of Energy & Petrochemicals and D Rajgopalan, Chairman, GSPC and other officials from GSPC and Reliance Group.

The transportation of gas shall commence in the second quarter of 2008. The agreement is valid for a period of 15 years from the start date.

Similarly, Gujarat State Petroleum Corporation Ltd. (GSPCL) has signed Gas Transportation Agreement with Reliance Gas Transmission and Infrastructure Limited (RGTIL) for transporting 3.5 MSMCMD of natural gas from its largest KG basin discovery at Kakinada in Andhra Pradesh to Gujarat. As per this agreement, GSPC has an option to increase the volumes of gas upto 11 MSCMD. For transportation of gas from Kakinada to Gujarat, RGTIL is developing a pipeline between Kakinada and Bharuch.

The transportation of gas shall commence as soon as GSPC starts the production of gas from its KG basin. This agreement also has validity period of period of 15 years from the Start Date.

GSPC has made the largest discovery of natural gas in the KG basin two years before and the commercial production is likely to commence from mid 2009.

GSPC's KG gas being a domestic gas when it reaches Gujarat will be available to the people of Gujarat at a competitive price as compared to the imported gas. This also will help in supplying gas on a sustainable and long-term basis, to the power sector, local distribution including the household, resulting in the overall economic development of the State.

This will herald a new era of prosperity, as the GSPC's KG gas would give some relief to build the huge demand supply gap, being the domestic gas.