The Hindu Business Line : GAIL may infuse additional funds in Ratnagiri Gas

Negotiating deal For expediting the revival of the Dabhol project, the Government is considering the option of hiving off the LNG terminal and selling. At the time of equity infusion GAIL was given the first right to buy the LNG terminal.

New Delhi March 30 GAIL (India) Ltd today said that it was willing to infuse additional funds in Ratnagiri Gas and Power Private Ltd (RGPPL), erstwhile Dabhol project, provided it is given the adjacent liquefied natural gas (LNG) terminal.

Dr U. D. Choubey, Chairman and Managing Director, GAIL, said: "We are willing to infuse additional funds of Rs 500 crore in the project provided we are given the LNG terminal."

Separate Entity

The state-owned gas transmission major has been making the first claim on the LNG terminal of RGPPL, in case a decision to hive off the facility into a separate entity is taken.

The company would require its board approval for infusion of additional funds. GAIL holds 28.33 per cent equity in Ratnagiri Gas, which has under it a 2,150-MW power plant and a five million tonnes per annum LNG terminal and re-gasification facility.

Dr Choubey said the company's board of directors would consider the proposal. RGPPL requires Rs 450 crore for revival of power plants and Rs 565 crore for the LNG works, but it does not have the money to pay the contractors.

Equity Infusion

To expedite the revival of the Dabhol project, the Government is considering the option of hiving off the LNG terminal and selling it. RGPPL holds both the assets of power project — the 2,150-MW generation plant as well as the five million tonnes LNG, currently.

Both GAIL and NTPC had initially infused Rs 500 crore each to take an equity stake of 28.33 per cent.

The GAIL CMD said that at the time of equity infusion his company was given the first right to buy the LNG terminal as also the right to sell the additional LNG to other companies.

The LNG terminal requires an additional Rs 500 crore for completion.

Many big companies in the business are believed to have shown interest in acquiring the terminal.

Meanwhile, GAIL is already working on the Dahej-Uran-Panvel pipeline project, which is to transport LNG from Petronet LNG Ltd's Dahej terminal to Ratnagiri at an estimated cost of Rs 1,830 crore, with a capacity of 12 MMSCMD.

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