City gas distribution (CGD) is now drawing a better-than-anticipated interest from businesses going by the response to the ninth bidding round.
At the close of the bidding round, over 400 technical bids for developing 86 geographical areas (GAs) were received, the Petroleum and Natural Gas Regulatory Board (PNGRB) said on Tuesday.
PNGRB is the regulatory body that, among other things, looks at city gas distribution.
A PNGRB statement said the technical bids will be opened between July 12 and July 18. Sources said all the CGD regions have been bid for.
Officials from Indraprastha Gas Ltd and IndianOil-Adani Gas Private Ltd confirmed that they have placed bids. News reports suggested that Essel Infraprojects had also put in bids.
Sources said Adani Gas has bid alone for 32 geographical areas and has bid for 20 more through its joint venture with IndianOil.
The bidding round was started on April 12 for 86 GAs. It covered 174 districts over 22 States and Union Territories or 24 per cent of India’s geographical area.
A Crisil Ratings statement said, “The new GAs on offer include Chennai, Coimbatore, Visakhapatnam, Aurangabad and Bhopal, which have good demand potential.”
Crisil said the current round of bids is expected to receive better response than earlier rounds because of revised bidding norms. These include marketing the exclusivity period of 8 years (extendable by two years, compared with five years earlier), tariff floors to discourage unviable bids, removal of additional bid bond requirement and evaluation of bids based on higher infrastructure creation.
PNGRB said it will be speed up the process of awarding the CGD areas. “During roadshows, it was announced that the successful entities would be finalised by October, after technical and financial evaluation of bids. However, PNGRB is now trying to expedite the process.”
An investment of about ₹70,000 crore is expected in developing the areas that have been offered.