Reliance submits EoI for gas supply

Chennai: The Reliance group (Mukesh Ambani) has submitted Expressions of Interest to the Petroleum and Natural Gas Regulatory Board for supplying piped natural gas to homes in six cities in Tamil Nadu Chennai, Coimbatore, Madurai, Tiruchi, Tuticorin and Salem.

(The group has submitted similar EoIs for other States also.)

The EoIs have triggered the process of bidding.

Any company can bid for supplying natural gas to the cities, irrespective of whether it has tied up for natural gas or not.

The winning bidder will be given time to secure the gas supplies and lay the pipelines.

Thereafter, the bidder will be given five years of marketing exclusivity to sell the gas. After the end of the term, other players will also be allowed to supply natural gas.

However, they would have to pay a tariff for the pipeline infrastructure.

All this was disclosed by Mr L. Mansingh, Chairman, Petroleum and Natural Gas Regulatory Board (PNGRB), at a Round Table on City Gas Distribution, organised here by the Southern Region of the Confederation of Indian Industry.

Mr Mansingh said that as many as 73 EOIs have been received from many companies for supplying piped natural gas to 60 cities across the country.

For Tamil Nadu, whether it is Reliance Industries or any other company that wins the PNGRB’s authorisation for each city, gas will come from either the Krishna-Godavari basin or the Cauvery Basin.

At present, 3.6 MMSCMD of gas is being supplied from the Cauvery Basin to some 50 companies in the State.

Mr Mansingh said that the Board adopted a three-pronged approach in giving authorisations for city gas distribution.

The cities that will get priority will be those that already have a gas pipeline — where only the distribution pipelines will have to branch off from the trunk line. Second in the list of priority are those cities that are being linked to a gas pipeline.

The third are the cities where the pipeline projects are still in the concept stage. All the cities in Tamil Nadu are in the third category.

Therefore, natural gas to home kitchens and petrol bunks is still at least three years away for Tamil Nadu.

Reliance, which has discovered huge quantities of natural gas in the Krishna-Godavari basin, is understood to be planning a pipeline to Chennai, from where the line will fork off, with one branch going down to Tuticorin and the other to Coimbatore.

Reliance expects to produce 80 MMSCMD of natural gas from K-G, of which it is expected that 20 MMSCMD would come to Tamil Nadu.