The Hindu Business Line : IOC wants to build own gas pipeline

INDIAN Oil Corporation wants to build its own pipeline to transport gas from Petronet LNG's Dahej terminal in Gujarat to Uran in Maharashtra, instead of using the 475-km Dahej-Uran pipeline being built by GAIL (India).

"We are in the process of tying up deals with industries along the west coast of Maharashtra to sell our share of PLL gas and would like to lay a gas pipeline on our own for transporting this gas," Mr A.M. Uplenchwar, Director (Pipelines), told Business Line.

IOC, which holds 12.5 per cent of Petronet LNG's equity, will have to sell 30 per cent of the LNG imported from Qatar at the 5-million-tonne Dahej terminal. GAIL has to market 60 per cent of the imported LNG.

IOC's move, if allowed by the Government, will be another blow to GAIL's wish to be the sole transporter of gas by laying cross-country trunk pipelines.

Reliance Industries has already asked the Government permission to lay a 1,400-km gas line from Kakinada in Andhra Pradesh to Ahmedabad via Hyderabad and Uran, to transport gas from its Krishna-Godavari find on the east coast to NTPC's Kawas and Gandhar power projects in Gujarat.

The draft pipeline policy circulated by the Union Government in September 2003, had nominated GAIL as the sole transporter for building a cross-country network of trunk gas pipelines. Most oil and gas companies opposed the idea as the industry saw it as a conflict of interest because GAIL is also involved in gas production and trading.

IOC, with its experience in laying cross-country pipelines for transporting gas and petroleum products through its network of 7,586 km of crude and product pipelines, was one of the companies to oppose the idea.

The Petroleum Ministry is expected to announce the final gas pipeline policy in the coming month wherein laying inter-State pipelines will be competitive and anyone offering "the least terms of transportation tariff" and "most efficient means of operations" would get the contract.

All oil and gas pipelines, laid on common carrier principle, should have at least 25 per cent more capacity than what is required by the owner for leasing to third-party users.

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