GAIL to enter distributed LNG production

Our Bureau | | Updated on: Jun 22, 2022
GAIL Building in New Delhi (file image)

GAIL Building in New Delhi (file image) | Photo Credit: MEETA AHLAWAT

To procure portable liquefaction skids, supply off-grid locations and transport sector

State-run GAIL said on Wednesday it  plans to start distributed liquefied natural gas (LNG) production to cater to off-grid locations and the transport sector.

GAIL has ordered two small-scale liquefaction skids capable of producing LNG on a pilot basis. It will use proprietary technology-based mobile liquefaction skids, the gas utility said in a statement.

The plants will help distribute natural gas through liquefaction in new city gas distribution (CGD) areas, liquefaction of gas at isolated fields, and support the setting up of LNG fuelling stations and in bunkering, it added.

The portable and scalable liquefaction units will be the first of its kind in the country.

The project is envisaged to aid the government’s effort to increase the share of natural gas in the primary energy basket. Further, GAIL is under discussions to manufacture liquefaction skids in India.

Capex outlay

In FY22, GAIL’s total capex stood at ₹7,700 crore, which went mainly to pipelines, petrochemical, CGD projects, operational capex, equity contribution, and exploration and production (E&P).

Over the next three years, the capex is expected to be around ₹30,000 crore, including renewable projects.

The gas utility is eyeing a 10-year deal to import 1 million tonnes (MT) of LNG , with supplies likely starting in 2023. GAIL already has a long-term gas import agreement with Gazprom Marketing and Trading Singapore for around 2.5 MT annually.

The company is on the lookout for long-term and short-term (spot) deals to meet India’s growing demand for natural gas. GAIL expects its LNG imports to grow by 5-6 per cent in FY23.

Published on June 22, 2022
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