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Amit Mitra

Close to finalising jt venture with European firm for oil and gas pipeline projects

Mumbai Sept. 9

, Pratibha Industries Ltd, which is primarily engaged in execution of water supply projects, is planning to broaden its business canvas by getting into water tunnelling projects and laying of cross-country oil and gas pipelines. The company plans to form separate joint ventures with foreign partners to enter into the two areas.

Having recently concluded a joint venture agreement with Osto Statin of Austria, one of Europe's leading players in water tunnelling systems, Pratibha Industries is now looking for another partner to form a similar joint venture to bid for oil and gas pipeline projects in India.

"We are close to finalising a joint venture agreement with another European company, which is specialised in product pipelines. We should have this in place within the next six months. The joint ventures are aimed at creating the right synergies between the two partners," Mr Ajit B. Kulkarni, Managing Director, told Business Line.

Jt venture pact

The joint venture between Pratibha Industries and Osto are looking at underground water tunnelling projects like one for NTPC's power plant in Bihar. Under the joint venture agreement, the Austrian partner will be bringing in specialised tunnel boring machines, each of which cost about Rs 35 crore. The major Indian players in this segment include, Hindustan Construction Co, Patel Engineering, Gammon and Simplex.

The company is, however, betting big on its foray into the oil and gas pipeline segment. "The proposed cross-country pipelines in India involve staggering investments. It certainly represents a major growth opportunity for us," Mr Kulkarni said.

While the foreign partner in this joint venture will bring in technology, Pratibha Industries will contribute its expertise in the physical work and supply of pipelines. For this purpose, the company is setting up a plant for manufacture of spirally welded pipes used for long-haul pipelines.

Saw pipe unit

"This saw pipe division will be operational by next year and is expected to produce 56,000 tonnes in 2007-08 and 1.5 lakh tones by 2012-13. The expected turnover, at the current rate of Rs 32,000 per tonne, is Rs 400 crore in 2007-08 and Rs 1,100 crore in 2012-13," according to Mr Kulkarni.

While some portion of the pipelines will be used for the proposed joint venture's oil and gas pipeline projects in India, the rest would be sold.

Some of the upcoming pipeline projects in the country include the Rs 734-crore Panipat refinery expansion-liked pipeline project, Rs 127-crore 160-km-long pipeline from Lasariya to Chittaurgarh, the Mundra-Kandla crude oil pipeline, the Rs 1,178 crore Paradip-Haldia crude oil pipeline, the Rs 322-crore Koyali to Ratlam pipeline of 274-km length, the Rs 215-crore regassed LNG pipeline between Dadri and Panipat and GAIL's 600-km LPG pipeline from Visakhapatnam to Secundrabad in Andhra Pradesh.

The company, which notched up a turnover of Rs 175 crore in the last fiscal, currently has an order book worth Rs 700 crore.

More Stories on : Alliances & Joint Ventures | Infrastructure | Water

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