IndianOil in talks with RIL, GAIL for JV
New Delhi   28-Mar-2008
State-run IndianOil is in talks with Oil and Natural Gas Corporation (ONGC), Reliance Industries (RIL) and GAIL (India) to form 3 joint ventures for city gas distribution. Through its first joint venture, Green Gas (GGL), the company along with GAIL is operating in Lucknow and Agra. B M Bansal, director business development, IndianOil, said: "We are in discussion with these companies to form a joint venture for city gas distribution. But we will be able to finalise it only after the Petroleum and Natural Gas Regulatory Board (PNGRB) comes out with its guidelines." In November 2007, PNGRB had proposed a competitive bidding process to select public and private entities for developing city gas distribution networks in the country. The Downstream oil regulator has issued draft regulations regarding the method for selection. As per the proposal, the board may on its own invite preliminary bids from entities. The bids would then be evaluated based on the technical and tariff details. At present, state governments authorise companies to lay city gas distribution networks. Indraprashtha Gas, Mahanagar Gas and Gujarat Gas distribute gas to retail customers in a few cities. The government plans to roll out city gas network in around 200 cities in five years. This would involve an investment of Rs 60,000 crore (at about Rs 300 crore per city). Currently, only about half a million people in the country get gas in their kitchens, which is about 30 per cent cheaper than the traditional cooking fuel liquefied petroleum gas (LPG).