GAIL pipeline: Delay worries industrialists | india | Hindustan Times
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GAIL pipeline: Delay worries industrialists

india Updated: Sep 13, 2006 14:29 IST

PITHAMPUR INDUSTRIALISTS have voiced concern over the delay in completion of GAIL’s Jagoti-Pithampur pipeline project. GAIL is laying a 135-km gas (R-LNG) pipeline from Jagoti in Ujjain district to Pithampur in Dhar district. The pipeline, costing Rs 195 crore, would supply R-LNG from Petronet LNG’s Dahej terminal in Gujarat. The project was scheduled for completion by June 2006.

However, GAIL has now written to industries, which have signed the gas supply agreement (GSA), that the gas would be made available only after December 31, 2006.

Industries like Pratibha Syntex have already placed orders for gas-based engines and are facing huge loss in interest costs and power shortage in absence of gas supply.

Industrialists are also irked over the fact that GAIL has commenced gas supply in Malanpur (Gwalior) but is not giving any firm commitment for Pithampur, although some months ago it had promised to commission  the project by October 2006.

Natural gas is a cheaper alternative to other fuels such as diesel, LDO and furnace oil, and as such there is great demand from the industry for piped natural gas. As of now, 11 industries of Pithampur have signed GSA with GAIL and although more are willing to sign it, GAIL has expressed its inability to supply more gas as its share of R-LNG from Petronet LNG had already been tied up.

A senior GAIL official told Hindustan Times that the project has been delayed due to various constrains and is expected to be completed by February 2007. Lack of availability of natural gas has been the reason for curtailment of other projects as well. The State Government wanted the Jagoti-Pithampur pipeline to be linked to Barwah by a 40-km pipeline to supply gas to a 330-mw gas-based power plant. However, GAIL was unable to execute the project due to non-availability of gas.