GAIL India, which earlier announced its plan to lay the Rs 20,000 crore (Rs 200 billion) national gas grid across the country, will complete laying the 610-kilomtere long pipeline between Dahej in Gujarat and Uran in Maharashtra by end of March, next year.

GAIL will extend this pipeline up to Pune under its proposed 1250-kilometre long Kakinada-Hyderabad-Pune pipeline project.

GAIL officials here also said that it will adopt a joint-venture model for going ahead with its plan of setting up compressed natural gas (CNG) and piped natural gas (PNG) distribution networks in 22 cities.

"We have completed the process of awarding initial contract for the Dahej-Uran pipeline while rest of work for this sector is being worked out on priority basis as this pipeline, we need to lay synchronising with the commercial operation of the upcoming liquid natural gas (LNG) terminal being developed by Shell Hazira in Hazira of Surat district. As the terminal is expected to be commissioned by the first half of next fiscal, we expect to complete laying the pipeline in this sector by March, 2005," Proshanto Banerjee, CMD, said.

The pipeline will pass through Hazira, around 32 kilometres away from Surat while it will have another point at Dahej, where Gail alongwith a consortium of companies is setting up a 5 million metric tonne per annum LNG terminal under the umbrella of Petronet LNG.

GAIL has also recently signed an agreement with Shell for carrying LNG from its Hazira terminal to Maharashtra through its Dahej-Uran pipeline.

"We have signed the agreement on February 2 with Shell for carrying its LNG and now we are working on this sector on a priority basis while we expect to complete the total 7,900 kilometre long national gas grid by 2008," said Banerjee.

We also have initiated talks with Reliance Industries Limited and Gujarat State Petroleum Corporation Limited for carrying their gas also while we are going to initiate talks to Cairn Energy and ONGC for the same purpose," said Banerjee.

Apart from the Dahej-Uran sector, the pipeline project will also cover the stretch between Kakinada to Pune via Hyderabad, Dabhol-Bangalore-Coimbatore-Kochi and also Kakinada-Chennai and Chennai to Bangalore in the first phase.

Sharing his company's future plan on setting up gas distribution network in 22 cities, announced earlier, Banerjee, said, "In next five years, we will be setting up gas distribution network in 22 cities including Blue Sky project in five cities which will cost around Rs 600 crore (Rs 6 billion) per city, thus calling for total Rs 13,200 crore (Rs 132 billion) of investment."

"Hence, we are going to adopt the joint-venture model for the city gas distribution projects and already have initiated talks to few companies in local level, citywise like for gas distribution in Rajkot and Surendranagar districts of Gujarat, for which we have already got the rights from the state government, we are talking to GSPCL," he said.

Saying that Gail also was eyeing for three cities of Gujarat, Surat, Vadodara and Ahmedabad where level of vehicular pollution is very high, Banerjee said, "As some other companies already have been given rights for gas distribution in these cities, we are looking for other cities in Gujarat for gas distribution."

LNG terminal set to go on stream

• The country's first regassified liquid natural gas (LNG) terminal will be commissioned at Dahej in Gujarat on Monday.
• The Rs 2,900 crore (Rs 29 billion) terminal with an initial capacity of 2.5 mmtpa is planned to be expanded to 5 mmtpa in the next one year.
• Its is developed by Petronet LNG Ltd, a consortium of gas and oil majors in the country. The terminal is scheduled to be inaugurated by Union petroleum minister Ram Naik.